Tax Preparation Services — profit margin & cost structure (U.S.)

For the U.S. tax preparation services industry, IRS tax data shows an estimated 39.3% net margin on an owner-operator basis (national, sole proprietorships, tax year 2023). That figure — what a self-employed owner keeps per sales dollar before paying themselves — is the number this page exists to report; read the note below on how it's measured.

39.3%net margin · owner-operator basis

National as of tax year 2023 Lower confidence source ↗

Owner-operator basis (IRS SOI sole proprietorships, TY2023, based on ~333k returns): net income less deficit ÷ business receipts. Measured at 'Other accounting services' (541213/214/219 — tax prep, bookkeeping, payroll pooled); 541213 not isolated. Owner's own labor is not expensed.

Cost structure

National, from IRS Statistics of Income (weighted sample). Where a component is not separately reported, it is shown as insufficient data — never estimated.

Component	Value
Cost of goods sold (% of receipts)	4.5%	National source ↗
Labor / officer compensation (% of receipts)	6.8%	National source ↗

2019–2023 trend (national)

Change in the number of tax preparation services establishments and employment, nationally, from Census County Business Patterns.

Metric	2019	2023	Change
Establishments	30,886	28,762	-6.9%
Employment	158,136	133,868	-15.3%

Business size distribution (national)

Share of U.S. tax preparation services establishments by number of employees (Census County Business Patterns, 2023). 69% have fewer than 5 employees.

1–4 emp19,876 (69%)

5–9 emp6,010 (21%)

10–19 emp2,092 (7%)

20–49 emp651 (2%)

50–99 emp112 (0%)

100+ emp20 (0%)

Where this industry operates — all 51 states

Establishment counts, employment, and wages are available for free elsewhere too (e.g. Data USA). States ordered by number of establishments — pick one for local context:

Full cost-structure breakdown by business-size class and side-by-side industry comparison are available to subscribers. This page shows the current-year national headline plus the multi-year establishment trend.

Frequently asked

What is the average profit margin for tax preparation services businesses?

About 39.3% net margin on an owner-operator basis (national, IRS SOI sole proprietorships, tax year 2023). This counts the owner's own labor as profit, so it overstates corporate-style margin — see the note above.

How many tax preparation services businesses are there in the U.S.?

28,762 establishments with paid employees (Census County Business Patterns, 2023).

What is the average wage in the tax preparation services industry?

$1,055 per week (BLS QCEW 2024, private sector) — about $54,860/year.

Is the tax preparation services industry growing?

The number of U.S. tax preparation services establishments changed -6.9% from 2019 to 2023 (30,886 → 28,762), per Census CBP.

Run a tax preparation services business?

mewayz runs your website, bookings, payments, invoicing, CRM and back office in one place — one login, one price, no per-seat fees. Built for how a tax preparation services business actually works, so you stop paying for five disconnected tools that don’t talk to each other.

Start free →14-day free trial · no card to build · cancel anytime

Download the free Tax Preparation Services benchmark sheet (CSV) — a starter P&L pre-filled with these numbers · Pro workbook →

machine-readable JSON · NAICS 541213

Related industries

Accounting, Tax Prep & Bookkeeping Services Architectural, Engineering & Related Services Computer Systems Design Services Legal Services Other Professional, Scientific & Technical Services Professional, Scientific & Technical Services Specialized Design Services Veterinary Services