Annapolis CPA Tax & Accounting Practice, 30-Year Maryland Firm

$2.8M

Revenue

$881K

SDE

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Full Editorial Writeup

This is a well-established CPA practice in Annapolis, Maryland that has operated for more than 30 years, serving both individual and business clients across tax, bookkeeping, accounting, and payroll. The listing quotes gross revenue between roughly $2.29M and $2.75M with cash flow (SDE) of $881K, implying an owner earnings margin in the low-to-mid 30s. That margin, combined with the age and stability of the client base, is what makes accounting practices some of the most reliable cash-flow buys in the SMB market.

What sets this one apart from a typical seasonal tax shop is its revenue mix. Roughly 48% of revenue comes from monthly recurring bookkeeping and payroll, 36% from tax work, and the balance from QuickBooks and consulting. That heavy weighting toward monthly recurring work smooths out the notorious April-heavy cash flow curve of a pure tax firm and gives a buyer year-round, contract-like income rather than a once-a-year sprint.

The firm runs with an experienced staff already in place and an owner who describes a manageable workload with strong work-life balance, which signals delegable operations and healthy fee structures. It is positioned as a fit either for an individual CPA stepping into ownership or for an existing firm bolting on a presence in the affluent Annapolis and Anne Arundel County market. The seller offers transition support to protect both client and staff retention.

Why we like it

Earnings quality is excellent: $881K of cash flow on roughly $2.3M to $2.75M in revenue is a 32% to 38% margin, backed by service lines that are diversified across tax, bookkeeping, payroll, and consulting. That balance means no single line failure sinks the year, and the fee structures are described as strong.
The moat is 30-plus years of client relationships in a sticky, high-switching-cost service. Clients rarely change accountants who already hold their books, payroll, and tax history, and the 48% recurring bookkeeping and payroll base renews by default rather than needing to be re-won each season.
Accounting is genuinely recession resilient because tax filing and payroll are legally mandatory and bookkeeping is operationally essential, so demand persists through downturns. Annapolis and Anne Arundel County are affluent, government-adjacent markets with a deep base of small businesses and higher-income individuals.
The operator advantage is real: staff is already in place, workflows are efficient, and the current owner runs a manageable workload. A buyer can step in as a light-touch owner or an existing firm can absorb the book onto its platform and strip duplicate overhead to expand margin immediately.

How to improve it

Attack the recurring base first. With 48% of revenue already in monthly bookkeeping and payroll, run a pricing review and move flat legacy engagements to tiered fixed-fee packages with annual price escalators, which drops straight to the bottom line without adding a single client.
Cross-sell the tax-only clients into monthly advisory and bookkeeping. The 36% tax base is a warm list that already trusts the firm, and converting even a fraction into year-round retainers raises revenue per client and further smooths seasonality.
Migrate remaining manual workflows onto standardized cloud tools. Push all bookkeeping clients onto a single platform such as QuickBooks Online with automated bank feeds and document collection to cut preparation hours per return and increase staff capacity without new hires.
Build a formal client-referral and CPA-network pipeline. A 30-year firm in an affluent market almost certainly grows by word of mouth alone, so a structured referral incentive plus relationships with local attorneys and financial advisors can restart organic growth cheaply.
Institutionalize the owner's relationships before the seller leaves. Document client contacts, assign each account to a named staff lead, and get written engagement letters in place so client loyalty transfers to the firm rather than walking out with the departing owner.
Use this as a roll-up anchor. Similar practices are listed nearby in Montgomery and Washington counties, so a buyer can bolt on smaller books, centralize back office and payroll processing here, and drive multiple arbitrage across the region.

Diligence notes

Reconcile the revenue figure. The description says approximately $2,290,000 gross while the listing header states $2,750,000, so demand three years of tax returns and financials to confirm actual top line, trend direction, and the true basis for the $881K cash flow claim.
Test client concentration and retention. Pull revenue by client for the top 20 accounts and multi-year retention on the recurring bookkeeping and payroll base to confirm no single client or handful of clients drives an outsized share of that 48% recurring revenue.
Scrutinize staff dependency and comp. Since the owner claims a light workload, the practice likely runs on senior staff, so verify tenure, compensation, non-compete status, and retention risk after close, because losing a key preparer can gut both capacity and client trust.
Confirm the owner's actual working hours and role. A manageable owner workload may still hide critical review, signing, or rainmaking functions, so quantify billable and non-billable owner hours and clarify whether the buyer must be a licensed CPA to sign returns and hold the firm license.
Verify the recurring revenue is contractual. Confirm that bookkeeping and payroll clients are on written monthly engagements with clear terms rather than informal handshake arrangements, since that distinction drives both the multiple and the durability of the cash flow.

Source

Originally listed on BizBuySell. View original listing →