Tax Office Launch Guide: PTIN, EFIN & Setup (2027)

Is opening your own tax office a good fit?

A tax preparation business is a seasonal, deadline-driven professional service. Most of the work happens between late January and mid-April, when you interview clients, gather documents, prepare and review returns, collect signatures, transmit returns electronically, and answer questions about refunds and notices. The rest of the year is for training, renewing credentials, marketing, amended returns, extensions, and planning for the next season.

It suits people who are detail-oriented, comfortable with software, good at explaining things plainly, and willing to keep learning as tax law changes each year. It also carries real responsibility: you sign returns, you are subject to IRS rules and penalties, and you hold sensitive data for every client.

You do not need to be a CPA to prepare returns for pay, but you do need the right IRS identifiers, a secure setup, and solid training. The rest of this guide walks through those steps in the order most new offices tackle them. If you want the short version of how we help with setup, see How it works.

Step 1: Get (or renew) your PTIN

A Preparer Tax Identification Number (PTIN) identifies you as a paid preparer and goes on every return you prepare. The IRS says anyone who prepares or assists in preparing federal tax returns for compensation must have a valid PTIN before preparing returns, and all enrolled agents must also have one. (Attorneys and CPAs need one only if they prepare all or substantially all of a federal return for compensation.)

You apply or renew online through the IRS Tax Professional PTIN System. The IRS says most first-time applicants can get a PTIN online in about 15 minutes. Have your Social Security number, personal and business contact information, your prior-year individual tax return, explanations for any felony convictions or problems with your own tax obligations, any professional credential details, and a card for the fee.

The PTIN fee for 2026 is $18.75 and is non-refundable. PTINs are issued for a calendar year and are valid until December 31 of that year, so every preparer must renew annually. If you are starting now for the 2027 filing season, apply for or renew your PTIN for calendar year 2027 and confirm the current fee on the IRS PTIN page when you do, because the IRS sets it each year.

• PTIN = you, the individual preparer. It is not the same as an EFIN, which belongs to your firm. See EFIN vs PTIN for a side-by-side comparison.
• Keep your PTIN account information current; the IRS uses it to contact you.

Step 2: Apply for an EFIN and become an Authorized IRS e-file Provider

To transmit returns electronically under your own business, your firm needs to be an Authorized IRS e-file Provider with an Electronic Filing Identification Number (EFIN). Return preparers generally apply as an Electronic Return Originator (ERO), the provider option for firms that originate the electronic submission of returns they prepare or collect. There is no IRS fee for an EFIN.

The process runs through IRS e-Services. First, each person who will be on the application creates an IRS account and verifies their identity (the IRS uses ID.me for this). Next, you complete the e-file application online: firm details, your provider option, and information for each Principal (generally the owner or partners) and at least one Responsible Official (the person responsible for the firm's e-file operations and compliance). Each Principal and Responsible Official answers personal questions and signs the application's terms.

If a Principal or Responsible Official is not an attorney, CPA, or enrolled agent, they must be fingerprinted; the IRS uses an electronic Livescan process with locations nationwide. The IRS then runs a suitability check that can include a credit check, a review of your own tax compliance, a criminal background check, and a review of prior e-file compliance. When you are approved, you receive an acceptance letter with your EFIN.

Timing matters. The IRS says to allow up to 45 days from submission for approval, and Publication 3112 tells applicants to plan accordingly. Fingerprint appointments and ID.me verification add time before you can even submit. For a January launch, aim to submit your application in October or early November. After approval, you must update your application within 30 days of changes such as a new address, Principal, or Responsible Official.

• Decide your business structure and get your EIN before you apply. Pub. 3112 notes that changes requiring a new EIN (for example, sole proprietorship to corporation) require a new e-file application.
• Not ready to hold your own EFIN this season? Some preparers work under an established office or service bureau first. Ask us how that works during your consultation at Apply.

Step 3: Understand the preparer e-file requirement

Federal law generally requires a specified tax return preparer to e-file individual income tax returns. Under the Form 8948 instructions, you are a specified tax return preparer if you reasonably expect to file 11 or more covered returns (individual income tax and certain trust returns) in a calendar year. If you are a member of a firm, the count is the firm's aggregate: two preparers who each expect to file 6 returns are both covered because the firm expects 12.

In practice, any office planning to grow past a handful of clients should treat e-file as required. When a covered return must go on paper, Form 8948 documents the reason. Some states, such as New York, have their own preparer e-file mandates as well, so check each state where you file.

Step 4: Credentials, education and state registration

A PTIN lets you prepare returns for pay, but by itself it gives you no right to represent clients before the IRS. Credentials change what you can do for clients after a return is filed:

• Annual Filing Season Program (AFSP): a voluntary IRS program. You complete 18 hours of continuing education each year, including a six-hour federal tax law refresher course with a test, renew your PTIN, and consent to Circular 230 obligations. You receive a Record of Completion, appear in the IRS public directory of preparers, and get limited representation rights: you can represent clients whose returns you prepared and signed, but only before revenue agents, customer service representatives and similar IRS employees, including the Taxpayer Advocate Service.
• Enrolled Agent (EA): licensed by the IRS. You pass all three parts of the Special Enrollment Examination, apply for enrollment, pass a suitability check, and maintain 72 hours of continuing education every three years. EAs have unlimited representation rights, including audits, collections and appeals.
• CPA or attorney: licensed by a state board of accountancy or state bar, also with unlimited representation rights.

State preparer requirements to check

Some states regulate paid preparers beyond the IRS rules. The examples below were confirmed on official state sites; other states may have requirements too, and exemptions often apply to CPAs, attorneys and EAs. Always check the state where you work and every state you file in.

• California: non-exempt paid preparers must register with the California Tax Education Council (CTEC), which requires a 60-hour qualifying education course from an approved provider, a $5,000 tax preparer surety bond, a PTIN, and Live Scan fingerprinting. CTEC new preparer requirements.
• New York: you must register if you will be paid to prepare a substantial portion of any New York State return. Commercial preparers (10 or more NY returns) pay a $100 registration fee and complete state continuing education; preparers must also post a price list and the Consumer Bill of Rights. NY registration.
• Maryland: the State Board of Individual Tax Preparers handles examination, registration and continuing education for individual preparers. Maryland Board.
• Oregon: tax practitioners are licensed by the Oregon Board of Tax Practitioners. Oregon Board.

Step 5: Set up the business

Entity. Many new offices start as a sole proprietorship or form a limited liability company (LLC), which is a business structure created under state law. An LLC can separate business and personal liability in some situations, but the right choice depends on your state, your tax situation and your plans to hire or partner. Talk to a qualified attorney or tax professional before you file formation papers, and set up the entity before your e-file application so the EFIN is tied to the right business.

EIN. An Employer Identification Number is free from the IRS online, and you receive it immediately if approved. The IRS warns that you never have to pay a fee for an EIN, so avoid third-party sites that charge for it.

Banking and insurance. Open a dedicated business bank account so fees, software costs and bank-product deposits stay separate from personal money. Consider errors and omissions (professional liability) insurance, plus general liability if clients visit your location.

Local rules. Check city or county business licenses, home-occupation rules if you work from home, sales-tax registration if applicable, and signage or lease requirements if you rent space.

Step 6: Security and compliance from day one

FTC Safeguards Rule. The Federal Trade Commission specifically lists tax preparation firms as financial institutions covered by its Safeguards Rule under the Gramm-Leach-Bliley Act. Covered firms must develop, implement and maintain an information security program with administrative, technical and physical safeguards, designate a Qualified Individual to oversee it, use multi-factor authentication for anyone accessing customer information, and encrypt customer information on their systems and in transit. Firms must also notify the FTC no later than 30 days after discovering a security event involving the unencrypted information of 500 or more consumers.

Your WISP. IRS Publication 4557, Safeguarding Taxpayer Data, explains that the Safeguards Rule requires companies to develop a written information security plan (WISP), and that failure to do so may result in an FTC investigation. IRS Publication 5708, Creating a Written Information Security Plan for your Tax & Accounting Practice, is a free template built for small offices. Write your WISP before the season, train anyone who touches client data, and review it at least yearly.

Section 7216 consents. Internal Revenue Code section 7216 and its regulations restrict how preparers use or disclose tax return information. Outside narrow exceptions, you need the client's written consent in the required format before using their return information for other purposes or disclosing it, which can include some marketing uses. Many professional software packages include consent templates; review them against the IRS guidance and use them consistently.

Due diligence. If you are paid to prepare a return claiming the Earned Income Tax Credit, the Child Tax Credit/Additional Child Tax Credit/Credit for Other Dependents, the American Opportunity Tax Credit, or Head of Household filing status, you must meet due diligence requirements and complete Form 8867. The penalty is $665 per failure for returns filed in 2027 (it was $650 for returns filed in 2026), so one return claiming all four benefits could cost $2,660. Keep the required records for 3 years.

Step 7: Choose your software and service bureau

Your professional tax software is the engine of the office, and your service bureau is the partner that sets you up on it and supports you. A service bureau is a company that provides professional tax software, bank-product enrollment, training, and support to independent offices, and often handles setup and troubleshooting during the season. Some bureaus also let experienced owners recruit and support other preparers as a sub-bureau. For the full explanation, read What is a service bureau.

When you compare options, look past the headline price and ask:

• Return coverage: individual returns, common schedules, every state you need, amended and prior-year returns, and business returns if you plan to offer them.
• E-file and bank products: authorized e-file, which bank partners are available, and how preparer fees are collected from refunds.
• Pricing model: pay-per-return versus unlimited packages, per-return transmission or service fees, and what happens if you file more or fewer returns than expected.
• Remote features: mobile apps, client document portals, remote signatures, and multi-office or multi-preparer setups.
• Training and support: onboarding before the season, in-season live support hours and channels, and help with rejects.
• Security: multi-factor authentication, user permissions, encryption, and audit logs that support your WISP.

Step 8: Bank products and refund transfers, explained

Many clients cannot or do not want to pay a preparation fee upfront. A refund transfer (sometimes called a refund anticipation check) is a product offered by a bank partner, not by the IRS or by the preparer. The client's refund is deposited into a temporary account at the bank; the bank deducts the authorized preparation fees and the bank's own product fee, then sends the remainder to the client by direct deposit, check or card. A refund advance or refund anticipation loan is different: it is a loan against the expected refund, and the client may owe it regardless of the refund.

These products are subject to eligibility, bank approval and fees, and the client should always be told they are optional and that they can pay the preparation fee directly. IRS Publication 3112 requires providers to clearly state in advertising that a financial institution is advancing funds or providing a financial product, and that the taxpayer is not receiving the refund itself from the IRS. Refunds on returns claiming the Earned Income Tax Credit are held by law until mid-February, which affects when clients receive funds.

Some states and cities add consumer-protection rules. For example, New York State bars preparers from charging any fee for facilitating a refund anticipation loan or check other than the bank's own fee, and New York City requires posted prices, itemized receipts, and an English and Spanish disclosure before offering a refund anticipation loan. Check the rules where you operate. Our bank partner, product terms and fees are confirmed during enrollment; see Software & features.

Step 9: Price your services

There is no single right price. Common approaches include a per-form or per-schedule fee (a base return plus each additional form), a flat fee by complexity tier (simple, moderate, complex), or a minimum fee plus add-ons. Whichever you choose, write it down, apply it consistently, and give clients an estimate before you start.

Base your numbers on your costs (software, bank-product and transmission fees, insurance, rent, marketing, your time per return) and on what established preparers in your area charge. Remember that bank-product fees are paid by the client to the bank and are separate from your preparation fee. Charge for the work you do rather than the size of the refund, and follow any posting or receipt rules in your state or city. To see how different packages affect your costs, visit Pricing.

Step 10: Find your first clients

Most new offices grow through relationships first: family, friends, coworkers, community groups and local small businesses, plus a referral ask for every satisfied client. Then build a simple presence with a Google Business Profile, a basic website or booking page, and clear posts about what to bring and when you open.

Keep marketing honest. Do not promise refund amounts or timing, do not imply IRS endorsement, and describe bank products accurately. Section 7216 also limits marketing use of clients' return information without consent.

Season timeline: October to April

Use this as a planning guide. IRS dates such as the official opening of the filing season are announced each year, so confirm them on irs.gov.

Next steps

Take it step by step: PTIN, entity and EIN, EFIN, training, security, software and bank products, then marketing. Download the 2027 Tax Office Launch Checklist below, read the FAQ, or apply to talk through your setup with our team. For a shorter overview, see Start a tax business in 2027. If you already lead a team of preparers, learn how to become a service bureau.

This guide is general information, not legal or tax advice. Rules change; verify requirements with the IRS and your state before you act.