How Much Does a Liberty Tax Service Franchise Cost?
Data from the 2024 Franchise Disclosure Document
Investment Summary
Total Investment
$42K – $61K
Franchise Fee
$15K
Royalty
14.0%
Ad Fund
5.0%
Cost Breakdown
Initial Franchise Fee
The initial franchise fee for Liberty Tax Service is $15K. This one-time payment covers the right to operate under the brand, access to proprietary systems, and initial training programs.
Total Investment Range
Opening a Liberty Tax Service franchise requires a total investment of $42K – $61K. This range typically includes real estate or leasehold improvements, equipment and fixtures, initial inventory, signage, insurance, and working capital to sustain operations during the ramp-up period.
Working capital alone ranges from $3K to $5K.
Ongoing Costs
Beyond the initial investment, Liberty Tax Service franchisees pay ongoing fees. The royalty fee is 14.0% of gross sales (Percentage of Gross Receipts). The advertising or brand fund contribution is 5.0% of gross sales.
Net Worth & Liquid Capital Requirements
Liberty Tax Service requires working capital of $3K – $5K to cover initial operating expenses. This is the liquid cash you should have available beyond the franchise fee and buildout costs.
What Can You Earn?
According to Liberty Tax Service's Item 19 financial performance representation:
Median gross sales: $132K
This figure comes from Item 19 of the FDD. Gross sales are not the same as take-home profit. After deducting royalties, ad fund fees, rent, labor, and COGS, net income is typically a fraction of gross revenue.
How Do Banks View Liberty Tax Service?
SBA Loans Issued
264
Default Rate
11.7%
The SBA (Small Business Administration) tracks loan performance for franchise brands. Liberty Tax Service has 264 SBA-backed loans on record. The default rate is 11.7%, which is below the franchise industry average, indicating relatively lower lending risk. A lower default rate generally indicates that lenders view the franchise as a safer investment, though past performance does not guarantee future results.
Next Steps
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