4 Tips For Selling Your Payroll Service In 2024
By Glenn Fallavollita, President of SellMorePayroll.com

• Word Count: 157
• Read Time: 36 Seconds

If you plan to sell your payroll business in the next 6 to 9 months, here are four tips to help make your business more appealing to a buyer.

1. Be Clear About Why You Are Selling Your Business:

• Retirement
• Monetary Gain
• Medical-Related Issues
• Family-Related Issues
• Burnt-Out From The Day-To-Day Grind

2. Understand Your Clients: Prospective buyers typically want to see:

• 3 Years’ Worth Of Sales/Profits (Balance Sheet, P/L Report, etc.)
• Average Annual Revenue Per Client
• How Many Clients
• Pricing Per Client
• Services Each Client Uses

3. Get Your Paperwork In Order: You need to have your paperwork in one file:

• Your Payroll Platform’s License
• Insurance Policies
• Staff’s Non-Compete Agreements
• Tax Returns
• List Of Assets
• Building Lease(s)
• Staff List
• Any Costs Associated With The Cancellation Of Your License Agreement 
• Monthly Expenses

4. How To Maximize Your Multiple: Ways to add value include:

• Cut Operational Costs And Increase Prices
• Reduce Labor Costs
• Add New Payroll Clients To The Business
• Tighten Vendor Agreements And Employee Non-Compete Agreements
• Purchase A CPA’s Book-Of-Business For 1X Or Less
• Remove Unnecessary Assets Used By Family Members

About The Author:

Glenn Fallavollita is a nationally recognized keynote speaker providing money-making advice to help payroll service owners, sales pros, and marketing gurus build more profitable relationships with their database of prospects, referral partners, and clients.

Additionally, Glenn is the president of SellMorePayroll.com and Drip Marketing, Inc. and has written 50+ whitepapers and three sales/self-marketing books, Supercharge Your Payroll Sales NOW!, Stop Whining AND Start Selling, and Drip Marketing: A Powerful New Marketing Strategy That Gets Prospects To Buy From You. He also writes blogs for LinkedIn and other national websites.

To hire Glenn for your next conference, visit DripMarketingSpeaker.com.

© Drip Marketing, Inc.  All Rights Reserved May Not Be Used Without Written Permission.

Is 2024 The Right Time To Sell Your Payroll Service?
By Glenn Fallavollita, President of SellMorePayroll.com & Drip Marketing, Inc.

More and more payroll owners are considering selling their payroll service due to:

• High Multiple On Annual Sales
• Slowing Economy
• Rising Taxes
• Buyers Are Flush With Cash
• X-Factors, i.e., retirement, health, quality of life, etc.

The 2024 tax year, and the return due in 2025, will continue with these seven federal tax brackets: 10%, 12%, 22%, 24%, 32%, 35%, and 37%. Your filing status and taxable income, including wages, will dictate the bracket you are in (as of 11/9/23).

• The standard deduction for married couples filing jointly for tax year 2024 rises to $29,200, an increase of $1,500 from tax year 2023. For single taxpayers and married individuals filing separately, the standard deduction rises to $14,600 for 2024, an increase of $750 from 2023; and for heads of households, the standard deduction will be $21,900 for tax year 2024, an increase of $1,100 from the amount for tax year 2023.
   
• Marginal rates: For tax year 2024, the top tax rate remains 37% for individual single taxpayers with incomes greater than $609,350 ($731,200 for married couples filing jointly).

  The other rates are:

  35% for incomes over $243,725 ($487,450 for married couples filing jointly)
  32% for incomes over $191,950 ($383,900 for married couples filing jointly)
  24% for incomes over $100,525 ($201,050 for married couples filing jointly)
  22% for incomes over $47,150 ($94,300 for married couples filing jointly)
  12% for incomes over $11,600 ($23,200 for married couples filing jointly)

• The lowest rate is 10% for incomes of single individuals with incomes of $11,600 or less ($23,200 for married couples filing jointly).

The "Potential" To Pay Higher Taxes Is Very Real With The Biden Administration.

While the decision to sell a payroll service should never be based on taxes alone, Biden's proposed tax plan would increase one's capital gain tax bill (see below).

• The proposed 39.6% capital gains bracket would apply to taxpayers with earned income in excess of $1 million ($500,000 for married filing separately).
• A taxable event, such as the sale of a business, could temporarily push income over the $1 million mark.

Click Here To Read Biden’s Tax Plan

A Successful Sale Requires Preparation On Your Part.

Succession planning is much more complicated than taking a check from a new owner, as there are many complex financial, legal, and relationship issues to consider.

If you want to read more about selling a payroll service, click this link: 4 Tips For Selling Your Payroll Service

About The Author:

Glenn Fallavollita is a nationally recognized keynote speaker providing money-making advice to help payroll service owners, sales pros, and marketing gurus build more profitable relationships with their database of prospects, referral partners, and clients.

Additionally, Glenn is the president of SellMorePayroll.com and Drip Marketing, Inc. and has written 50+ whitepapers and three sales/self-marketing books, Supercharge Your Payroll Sales NOW!, Stop Whining AND Start Selling, and Drip Marketing: A Powerful New Marketing Strategy That Gets Prospects To Buy From You. He also writes blogs for LinkedIn and other national websites.

© Drip Marketing, Inc.  All Rights Reserved May Not Be Used Without Written Permission.