Getting Started

How to start a tax business with no EFIN

One of the most common questions new preparers ask is whether they can start without an EFIN. The short answer: yes. Here's how it actually works, and how to do it the right way.

By Tiffany Hill Moore, Founder & former auditor · Updated July 2026

The short answer

To legally prepare federal tax returns for pay, you need a PTIN — a Preparer Tax Identification Number from the IRS. You do not need your own EFIN to begin. An EFIN (Electronic Filing Identification Number) belongs to the office that transmits returns to the IRS, and plenty of successful preparers spend their first season working under an authorized provider's EFIN while they build a client base.

PTIN vs EFIN, in one minute

Your PTIN identifies you as the paid preparer on every return you touch. It's personal, required, and quick to get online. The EFIN identifies the e-file provider — the business the IRS has approved to transmit returns electronically. One office, one EFIN; many preparers can work under it. Mixing these two up is the number one source of confusion for new preparers.

How to file under an authorized provider

Working under an established provider — such as a reputable service bureau — means your returns transmit under their EFIN while you keep your own PTIN on every return you prepare. A good partner does more than lend you infrastructure: they review your work, keep you compliant, and walk you through getting your own EFIN when you're ready. A bad one rents you access and disappears in April. Ask who reviews returns before they transmit, and how you'll eventually get your own ERO status.

Your first-season checklist

• Get your PTIN from the IRS (renew it every year)
• Partner with an authorized e-file provider you trust
• Complete real training before you touch a live return
• Understand due-diligence requirements — they apply to you personally
• Keep copies of your work and documentation for every return
• Start your own EFIN application early — it can take 45 days or more

When to get your own EFIN

Once you've proven you can serve clients and you want to keep 100% of your prep fees, apply for your own EFIN through IRS e-Services. The application is free but the suitability check takes time, so start it during the off-season. At The Tax Wealth Lab, we walk every partner through the application during onboarding and supervise their work while the IRS processes it — you build toward your own firm from day one.

Frequently asked questions

Can you prepare taxes without an EFIN?

Yes. You need a PTIN to prepare federal returns for pay, but the EFIN belongs to the e-file provider that transmits returns. New preparers commonly work under an authorized provider's EFIN in their first season.

What is the difference between a PTIN and an EFIN?

A PTIN identifies you personally as a paid preparer and is required for every preparer. An EFIN identifies an approved e-file provider business and is required to transmit returns electronically to the IRS.

Do I need an LLC to start a tax business?

No. You can begin as a sole proprietor with a PTIN. Many preparers form an LLC as they grow for liability protection and a professional brand, but it is not a legal requirement to prepare returns.