Turning Down Business To Specialize - it Doesn't Feel Right

I'm too busy, but I struggle to turn away business.

My anxious brain thinks, "what if the inquiries stop coming in 5 years".

And my selfish side says, "I spent all (a lot!) of that time blogging, networking, and pouring energy into my services so I can get good reviews - and now I Just give these valuable leads away?

You need to have a better business plan If you are at capacity why are you super advertising to get more business? If it is not managed correctly you will burn out my friend.

I stopped advertising because I am at capacity and I only take select new clients that are referred by existing clients. I stopped doing payroll years back.

If you are in a "Retail Tax Practice" where you have a store front and walk up counter; and offer finished
tax returns while you wait (like HRB) you are at the mercy of your staff.
You must lever your skills through others.
Turnover and mutiny are your constant nightmares.
Whose going to quit? When in the middle of tax season?
Whose going to set up shop next door, and take my best people?
It is an "art form" to meet and greet a client; and hand them off to a staffer -
and profit from it - learn how that's done. It's a great skill to have.
I once had a store front practice, in a brown stone on lawyers row.
It drove me crazy, so many clients coming to sit and drink coffee and chat,
and free park, "I'm just killing time before I see my Lawyer".
I sold out to a large regional firm (60 CPAs and 240 staff) and relaxed in Florida
to recover from the brain damage.

Stick to your business plan/ideal client and do not feel guilty. There is no point in advertising if you are already at capacity, because the best clients are almost always referrals.

With my current firm, I have never advertised. Sure, I have a website and I attend networking events, but that is about being involved in the community and having a resource for people (namely, referrals) to find out more about me. My growth is pretty impressive but still manageable.

Do not let fear rule your life and career. I did for a long time and it led me nowhere but to misery and at a pretty young age.

I'm not advertising. I get (free), everyday new client traffic from my previous efforts (blogging), endless referrals, and an under saturated market.

I'm not advertising. I get (free), everyday new client traffic from my previous efforts (blogging), endless referrals, and an under saturated market.

Consider yourself blessed

I totally get OP. I turned down an amazing referral recently. If the pandemic doesn't cause a person to reflect and re-prioritize, then what does? But turning away work is scary, and I also can't help but worry that they were the last good referral I will ever get and that the existing client relationships will crash and burn. Like if I turn away business, have I been arrogant and jinxed myself?

^^Exactly

^^Exactly

Podiatrists turns away hand work, dentists turn away oral surgery. I no longer do trusts, estates, or large C corps or any tax return that H and R would do, with some exceptions.

we do S Corps, Partenrships and complex 1040s.

we can charge 1600 to 2500 for an S Corp, some higher, and it takes 3 to 4 hours because we specialize.

be narrow was the best advice I ever got.....

This seems to becoming a real problem for many and it seems to be telling us there is a real shortage of future tax pros. For years we have been saying no new clients but we just keep getting bigger. This year we have already told the front desk tell everyone no new clients accepted even if they are referrals.

And it seems like most of the local CPAs are in the same boat. Most are dumping clients and not taking on new clients. We do not even have name to refer the clients we say sorry to.

Sure there is a chance you could turn away a future superstar client but you just have to accept that as the price to pay for maintaining your sanity. We are also telling clients not a single sit down meeting all tax season. 100% drop off or email. Hopefully that frees up time

To further complicate our lives - expect New Tax Legislation effective 1/1/2021 - given the Senate turn.
I hope the IRS gets funded more, so they answer the Priority Line.

I often turn away new prospects based on fit. In the time it takes me to research a client issue that is not in my sphere of competence I could be serving 3 or 4 other clients whose issues are within my sphere of competence.

I will say this again, Just stick to your business plan. In my experience every time I deviated from my business plan for one reason or other in the long term it was a bad decision.

If you are at capacity just do the best job you can to keep your clients. I don't worry too much about competition stealing my clients based on price. If they provide a better service more power to them

Its all about getting well paid - for your work.

Sure there is a chance you could turn away a future superstar client but you just have to accept that as the price to pay for maintaining your sanity. We are also telling clients not a single sit down meeting all tax season. 100% drop off or email. Hopefully that frees up time

For situations like this, it is ideal to always have a list of clients you are willing to "let free" as better clients more suited to your business plan come along. I am practicing it while still in growth phase, because I greatly value high quality clients. I do not accept every client that comes my way because a lot are simply too difficult to work with, despite fees charged.

I have had a few tax clients say they did not need my services for 2020+. I have not felt bad. I did not really want them in the first place, but continued rendering services for various reasons. Given my growth allows me to sort of pick and choose my new clients, I am willing to disengage from some existing clients.

I continue indicating no in-person meetings. I make exceptions for certain clients, mostly because I have also become friends with them, but overall if a client is not willing to be 100% virtual, I will not take them on.

If you're at maximum capacity when a prospective client comes along, why not examine your existing client base to see if any clients should be culled and replaced? Pain-in-the neck, slow-paying, wait-until-the-end, lower-realization rate, angry, obsessive....however you define a non-ideal client.

Yesterday I turned down engagement to prepare the tax return of an attorney! After looking at last 2 years returns and the fact that books and records, particularly meals, entertainment and travel expenses were shoddy IMHO. No written mileage log except for a few mapquest pages. Too many lunch receipts costing $20 or more.

What really got me was that his prior accountant (now retired) allowed deduction of his business suits under the guise of "required uniform" for court appearances. It was categorized under "office expenses"!

So if you care about your own business sometimes it is better to turn questionable clients away

What really got me was that his prior accountant (now retired) allowed deduction of his business suits under the guise of "required uniform" for court appearances. It was categorized under "office expenses"!

So if you care about your own business sometimes it is better to turn questionable clients away

I am stunned at what I see a lot of CPAs and EAs allow, when they know damn well what is being hidden or pushed through as deductions. I disengaged from a client one year because they ran a facelift through COGS; COGS for that year was like 3x normal years with same income, and the CPA that prepared it never questioned why COGS was suddenly so absurdly high.

I love the clothing one though and when I ask "can and do you wear the clothing out of work settings?" "Yes, you say? NO DEDUCTION FOR YOU!"