RWCPA asked, “Out of Curiosity can you tell me where your firm falls in that range?”
We're at the top of our peer group. Among other things, that means we can pay team members the sorts of salaries that larger firms do.
RWCPA commented, “I know a couple people that operate smaller Firms (1-2 CPAs) and actually do much better than the top tier in the article. But I also know a few that have attempted it and seemed to be back in industry within a year.”
One common format really experienced solo CPAs use is to run as a one CPA shop with a seasonal admin. That approach can be very profitable once the CPA has a rooster of good clients. It's a sweat shop business oftentimes. But people can make $200K, 300K a year.
That said, I believe the data strongly suggests most solo CPA firms work hard and make about what a senior makes.
I think RWCPA is already down the path, so this is for others considering this option… The “secret” is successful small firm owners need to be more than a technician to make more than a technician.
BTW I'm sure there are a variety of strategies and tactics people can use to enjoy success… for what it's worth, what we've done is leverage technology as much as possible and then focused on providing tax services to small business owners and entrepreneurs with multistate or international footprints.
Another comment: If someone wanted to own a small firm, I'd also consider going to work for a well-run small firm and then working hard to develop first the technical skills and then the marketing and management skills to either buy that firm from the owner when she or he retires… or to buy another firm. You'd need to be really careful: You'd want to get a top tier firm–not a sweat shop. But you could find yourself with a business where you make a good living for a long time, have total control over your work, etc.