Do you want to open a tax preparation business by buying Instant Tax franchise? If YES, here is how much it cost to open Instant Tax Services franchise successfully. If you are looking towards opening an Instant Tax Service Franchise, it will be nice for you to have a preview of what the company represents before going ahead to inquire about the total cost of opening the franchise in your location.
Instant Tax Service was founded in 2000 and they began franchising in 2004, about 16 years ago. The current CEO is Fez Ogbazion and they have their corporate head office at 1 S. Main St., #1430 Dayton, OH 45402, USA. As of 2018, the company owns and operates 1,718 franchises in the United States.
Fez Ogbazion was a college student from Ethiopia in 1994 when he started Instant Refund Tax Service. In their first tax season, his startup did returns for over 600 clients and eventually grew to dozens of locations. Ogbazion sold Instant Refund Tax Service to Jackson Hewitt in 1999.
In 2000, Ogbazion moved to Dayton, Ohio, with the profits from his business deal to found Instant Tax Service. By 2003, Instant Tax Service had 100 offices across several states, and the company began franchising in 2004. Instant Tax Service specializes in professional tax preparation, expedited refund and refund anticipation loans, offering both in-person and online filing services.
Instant Tax Service specializes in providing professional tax preparation, refund anticipation loans and expedited refund. Known to be a low-cost business venture, Instant Tax Service has become a major competitor, providing customers with outstanding service and instant results. Today Instant Tax provides both in-person and online filing services across the entire United States.
Financial Investment Required to Open a Instant Tax Services Franchise
Here are areas where you are expected to spend money and the cost associated with it;
1. Initial Investment Range: $39,000 – $89,000
All interested franchisee applicants must have a minimum net worth of $10,000 and a minimum if $10,000 in liquid assets. Currently, there is currently no estimated annual income for any Instant Tax Service franchise location.
2. Franchise Fee: $34,000
3. Royalty Fee: Instant Tax also has an ongoing royalty fee of 20 percent.
4. Local Advertising Spend, Local Marketing Fund, or Cooperative Advertising Contribution
At least 1 percent per calendar year and the Due Date: for this is Monthly. Please note that each local advertising Cooperative may elect to increase the monthly contribution if approved by a two-thirds majority of the members, and the minimum contribution is subject to adjustment by an amount not to exceed the increase in the CPI.
Centers owned by Instant Tax Service and its affiliates are also members of their respective local Cooperative and each company-owned Center has the same voting rights as the franchised locations within the Cooperative. If the company-owned Centers comprise the majority of a given Cooperative, the maximum and minimum fees for that Cooperative will be consistent with the range stated in this Item 6.
- Liquidated Damages Under Area Development Agreement: This fee varies but the Due Date is Payable within 30 days of the termination of the Development Agreement.
- Audit Costs: All costs and expenses associated with the audit, reasonable accounting and legal costs.
- Indemnity: This fee will vary under the circumstances and the Due Date is As incurred.
Please note that you must reimburse Instant Tax Service if it is held liable for claims arising out of your franchise operations.
- Insurance: Reimbursement of costs the franchisor’s out-of-pocket costs.
- Equipment, Supply, or Supplier Testing or Inspecting: Fee not to exceed the actual costs of inspecting and testing. (Due Date: Due on receipt of invoice.)
Please note that This fee covers the cost of testing or inspecting equipment, supplies, or suppliers you propose.
- POS Hardware and Software: Depends upon vendor and products purchased. (Due Date: Depends upon vendor and products purchased.)
- Attorneys’ Fees and Costs: Will vary under circumstances. (Due Date: As incurred.)
Payable to Instant Tax Service if it is forced to retain independent counsel and seek damages or injunctive relief to enforce the Franchise Agreement (whether or not suit is filed) or if Instant Tax Service is required to defend your unsuccessful claim against it.
- Veteran Incentives: This is open for negotiation
- Term of Agreement and Renewal: The length of the initial franchise term is 10 years. If requirements are met, franchisees can renew for one additional term of 10 years.
- Financial Assistance: Instant Tax Service has relationships with third-party sources which offer financing to cover the following: franchise fee, startup costs, equipment, inventory, accounts receivable, and payroll et al.
In Summary,
- Initial Investment: $39,000 – $89,000
- Net-worth Requirement: $10,000
- Liquid Cash Requirement: $10,000
- Ongoing Initial Franchise Fee: $34,000 – $34,000
- Ongoing Royalty Fee: 20%