LIBERTY TAX SERVICE
Liberty Tax Service offers franchises to operate retail income tax preparation offices using proprietary marks, business methods, and marketing techniques in specified geographic territories. The business model involves seasonal tax return preparation services, primarily from January to April, with franchisees required to comply with IRS regulations and offer ancillary products like refund anticipation loans. It targets low to middle-income customers, competing with H&R Block, Jackson Hewitt, online services, and nonprofits.
Disclaimer: This information was extracted using AI from public Franchise Disclosure Documents and should be independently verified. This is not financial or legal advice. Always review official FDD filings before making investment decisions.
Overview
Financial Requirements
14% royalty + 5% ad fund
Franchise Stats
Financial Performance
Item 19 Financial Performance
Data Based On: Data based on 1,599 franchise owned Liberty Tax offices that operated during tax season 2024 and also remained active in systems into tax season 2025. This excludes processing centers and seasonal offices, and represents 89% of the 1,791 franchise locations available as of February 15, 2024.
Extracted Item 19 Section
How LIBERTY TAX SERVICE Compares to Other Business Services Franchises
Key Insights
- Lower investment than 76% of Business Services franchises
- Top 10 largest franchise system in Business Services
- Lower than average SBA loan default rate in Business Services
| Franchise | Investment Range | Franchise Fee | Royalty | Locations |
|---|---|---|---|---|
LIBERTY TAX SERVICE Current | $50K - $71K | $25K | 14.0% | 1,686 |
| Bimbo Foods Bakeries Distribution, LLC | $14K - $607K | N/A | N/A | 6,454 |
| THE UPS STORE (TRADITIONAL) | $216K - $609K | $30K | 5.0% | 4,500 |
| JACKSON HEWITT TAX SERVICE | $71K - $105K | $25K | 15.0% | 2,744 |
| CRUISE PLANNERS | $2K - $21K | $11K | 3.0% | 2,655 |
| SERVPRO (UNIT) | $259K - $380K | $100K | 10.0% | 2,286 |
Business Services Average 187 franchises | $118K - $285K | $46K | 10.4% | - |
* Comparison based on latest FDD filings. Investment ranges from Item 7, fees from Item 5. Showing top 5 of 187 Business Services franchises by location count.
Locations & Growth
Outlet Growth Over Time
Total outlets at end of each year
Geographic Distribution (2024)
Outlets by state across the United States
+36 more states
SBA Loan History
Historical SBA 7(a) loan data for LIBERTY TAX SERVICE franchisees (2010 - 2025)
Loans by Year
* Data sourced from SBA 7(a) FOIA loan records. Default rate calculated from charged-off loans.
Franchisee Contacts
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Due Diligence
Litigation (Item 3)
Primarily franchisor lawsuits against former franchisees for breach of non-compete covenants, trade secret misappropriation, trademark violations, tortious interference, and unpaid royalties/fees; includes debt collection actions, a few franchisee counterclaims for breach of contract/wrongful termination, and franchisee-initiated disputes over area developer agreements.
Bankruptcy (Item 4)
Former parent NextPoint Financial Inc. filed for debtor relief under Canada's Companies' Creditors Arrangement Act on July 25, 2023, and Chapter 15 petition in US Bankruptcy Court on July 26, 2023, as foreign representative of the franchisor and certain US affiliates; assets sold January 2, 2024.
System Health (Item 20)
Franchise system changes reported in the most recent fiscal year
Frequently Asked Questions
How much does it cost to open a LIBERTY TAX SERVICE franchise?
The total initial investment to open a LIBERTY TAX SERVICE franchise ranges from $49,970 to $71,400. This includes a franchise fee of $25,000. Ongoing royalty fees are 14.0% of gross sales.
How much revenue does a LIBERTY TAX SERVICE franchise make?
According to the 2025 FDD, the average gross revenue for a LIBERTY TAX SERVICE franchise is $151,872. The median revenue is $129,445.
How many LIBERTY TAX SERVICE franchise locations are there?
As of the 2025 FDD, LIBERTY TAX SERVICE has 1,686 franchise locations. The company has been franchising since 1997.
Can you get an SBA loan for a LIBERTY TAX SERVICE franchise?
Yes, SBA loans are available for LIBERTY TAX SERVICE franchises. Historical data shows 170 SBA 7(a) loans have been approved for LIBERTY TAX SERVICE franchisees, with an average loan amount of $203,226. The historical default rate is 8.2%.
Is LIBERTY TAX SERVICE a good franchise to buy?
LIBERTY TAX SERVICE shows several positive indicators: established brand with 1,686+ locations, transparent financial performance data (Item 19), low SBA loan default rate. However, franchise success depends on many factors including location, local market conditions, and owner involvement. We recommend speaking with existing franchisees and consulting with a franchise attorney before making a decision.
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