Accounting Firm Valuation: CPA Firm and Accounting Practice Valuation Multiples
Enter your gross fees and owner earnings and read a range benchmarked to what accounting and tax practices actually closed at, not to the platform multiples in the trade press.
Estimated business value
Method breakdown
What moves this number
Estimate, not a certified appraisal. Your figures are not stored.
Accounting and tax practices sold in the US across the five years to 2025 went for a median of 2.04x seller discretionary earnings, or 1.02x annual gross fees, with an upper quartile of 2.66x and a lower quartile of 1.61x. The median practice sale price was $425,000, on median fees of $400,000 and median owner earnings of $208,303, after a median 162 days on the market. The profession has priced practices at one times gross fees for decades, and it is the only industry rule of thumb we have tested that matches what buyers actually pay: the median closed sale was 1.02x. The 4x to 7x EBITDA multiples in private equity coverage describe a different market, above roughly $2M of revenue and after partner pay is normalized to a market salary.
This page is a benchmark and an estimator, not a certified appraisal. Last updated September 2026.
Closed transactions
What accounting practices actually sold for
These are sale prices, not asking prices, from accounting and tax practices sold across the five years 2021 to 2025. Almost every article on this subject quotes one times gross fees and stops. The useful part is the shape of the distribution around that figure, because the distance between the bottom and the top of it is worth slightly more than the practice earns its owner in a year.
Median sale price
$425,000
What the middle accounting practice actually closed at
Median asking price
$449,000
What the middle accounting practice was listed at
Median revenue
$400,000
Annual gross fees of the middle practice sold
Median owner earnings (SDE)
$208,303
Seller discretionary earnings of the middle practice sold
| Practices sold, 2021 to 2025 | Lower quartile | Median | Average | Upper quartile |
|---|---|---|---|---|
| Seller discretionary earnings multiple | 1.61x | 2.04x | 2.23x | 2.66x |
| Revenue multiple (multiple of annual gross fees) | 0.92x | 1.02x | 1.07x | 1.17x |
| Revenue | $240,000 | $400,000 | $614,453 | $771,527 |
| Owner earnings (SDE) | $124,753 | $208,303 | $283,476 | $357,273 |
Source: BizBuySell accounting and tax practice valuation benchmarks, practices sold on the platform 2021 to 2025, retrieved September 2026. Benchmarks, not quotes. The multiple rows and the dollar rows are computed on the same population but not on the same practice, so multiplying a median by a median will not exactly reproduce a quartile.
Our calculation
The one industry rule of thumb that is arithmetically correct
Every professional trade prices itself on a folk rule expressed as a multiple of the top line. Accountants say one times gross fees. Insurance agents say two times commissions. Both rules are older than either dataset, and both are repeated without anyone checking them against what practices sell for. We hold closed-transaction data for both, from the same platform over the same five years, so the check is available.
| Trade | The rule everyone quotes | Rule implies | Median actually achieved | Rule error | Sale to ask ratio | Price conceded |
|---|---|---|---|---|---|---|
| Accounting and tax practices | One times annual gross fees | 1.00x | 1.02x | +2% | 0.97 | 3% |
| Insurance agencies | Two times annual commissions | 2.00x | 1.51x | -25% | 0.92 | 8% |
The accounting rule is right to within two percent. One times gross fees implies a 1.00x revenue multiple and the median accounting practice closed at 1.02x. The insurance rule is wrong by a quarter: two times commissions implies 2.00x and the median agency closed at 1.51x, so the number the trade repeats sits at roughly the 69th percentile of actual sales.
Now look at the last column. Accounting practices close at 0.97 of asking, conceding 3 percent. Insurance agencies close at 0.92, conceding 8 percent. Accounting is the tightest price discipline in the entire financial services peer set, and the only category that beats it is medical billing, which closes slightly above asking.
The connection is not complicated. Sellers set an asking price from the rule their profession repeats. When the rule is close to what earnings support, the asking price is already defensible and the negotiation is short. When the rule overstates, the asking price has to come down before anyone will sign, and the seller spends months discovering that.
One honest limit on this: it is two sectors, not a study. We are not claiming a law, and two points cannot establish one. What we can say is that both sectors price on a top-line rule, one rule is accurate and one is not, and the sector with the accurate rule concedes five points less on price. That is a checkable observation, and it is the reason we publish the rule error rather than just repeating the rule. The same comparison is run from the other side on our insurance agency valuation page.
Our calculation
Where the discount lands when an accounting practice sells
Asking multiples and sold multiples are both published, at the same four points of the same distribution, over the same five years. Subtracting one from the other tells you which asking prices survive diligence, and almost nobody does it.
| Point in the distribution | SDE multiple asked | SDE multiple achieved | Gap | Fee multiple asked | Fee multiple achieved | Gap |
|---|---|---|---|---|---|---|
| Lower quartile | 1.82x | 1.61x | -11.5% | 1.02x | 0.92x | -9.8% |
| Median | 2.32x | 2.04x | -12.1% | 1.15x | 1.02x | -11.3% |
| Average | 2.48x | 2.23x | -10.1% | 1.21x | 1.07x | -11.6% |
| Upper quartile | 2.89x | 2.66x | -8.0% | 1.27x | 1.17x | -7.9% |
Accounting is the flattest of the four sectors we hold this data for. The haircut is roughly 10 percent everywhere: 11.5 percent at the lower quartile, 12.1 percent at the median, 8.0 percent at the upper quartile. Compare that with HVAC business valuation, where the discount widens from nothing at the bottom to 19 percent at the top, or with insurance agencies, where the earnings multiple barely moves while the revenue multiple is cut through the middle.
A flat haircut means something specific: buyers are applying the same discipline to a cheap practice and an expensive one. Nobody is being punished for asking a high multiple, and nobody is being rewarded for asking a low one. The expensive practices in this market are expensive for reasons diligence can confirm, which is what you would expect when the asset is a documented, recurring fee base rather than a promise about next year.
One point that looks contradictory and is not. The multiple haircut is about 11 percent, but the reported sale to ask ratio is 0.97, a 3 percent concession. Both are correct because they measure different populations. The listings are a different set of businesses from the ones that sold, and the practices that actually close carry higher earnings than the average listing: median SDE of $208,303 sold against $202,500 listed. So the practices that sell are more profitable than the ones that sit, and they still close at a lower multiple. That is a useful thing to know before you price your own.
Our calculation
Which multiple actually predicts the price
The source publishes the median sale price, the median revenue, the median owner earnings and both median multiples as four separate figures. They should reconcile. Testing whether they do is the fastest way to find out which multiple to trust when you value your own practice.
| Route | Arithmetic | Predicted sale price | Error against the observed median |
|---|---|---|---|
| Owner earnings route | $208,303 x 2.04 | $424,938 | -0.01% |
| Gross fees route | $400,000 x 1.02 | $408,000 | -4.0% |
| Observed median sale price | Reported directly | $425,000 | Reference |
The earnings route lands $62 away from the observed median sale price on a $425,000 sale. That is an error of one hundredth of one percent, across four figures the source reports independently of each other. It is the closest reconciliation we have recorded in any sector, and it means the median SDE multiple of 2.04x is not an artifact of how the data was summarized. It is the actual price of a dollar of accounting practice earnings.
The gross fees route misses by 4 percent, which is small but four hundred times larger. So even in the one trade whose top-line rule of thumb is accurate, earnings still predict the price better than revenue does. Use one times gross fees to sanity-check a number. Use the earnings multiple to produce one.
There is a technical reason this fits so well here and less well elsewhere, and it is worth stating because it is a genuine check on the data. In most sectors the median of the individual multiples differs from the median sale price divided by the median earnings, because the median of a set of ratios is not the ratio of the medians. In HVAC those two routes give 2.58x and 2.46x. In accounting they both give 2.04x, to two decimal places. The distribution is tight enough that the two definitions converge, which is another way of saying accounting practices are priced more consistently than most trades.
Our calculation
What each rung of the range is worth in dollars
Multiples are abstract until you apply them to one practice. Here is the published median owner earnings figure of $208,303 priced at each point of the sold distribution, with what a buyer typically finds at that rung.
Lower quartile, 1.61x
$335,368
Owner prepares most of the returns, a compliance-weighted fee base, client list concentrated in a few large accounts
Median, 2.04x
$424,938
A normal owner-operated practice with a seasonal team, recurring compliance work and stable renewals
Average, 2.23x
$464,516
Pulled above the median by the largest practices in the set
Upper quartile, 2.66x
$554,086
Staff who own the client relationships, advisory and monthly work alongside compliance, documented transition, low owner dependence
The distance from the lower quartile to the upper quartile is $218,718 on identical earnings, which is 105 percent of what the practice pays its owner in a year. Nothing about the fee base changes across that range. What changes is who does the work and whether the fees recur.
Two comparisons make the point. Adding $30,000 of profit and selling at the median multiple is worth $61,200. Moving from the median multiple to the upper quartile on unchanged profit is worth $129,148, more than twice as much. Getting yourself out of the review chair pays better than billing more hours, and it is the one improvement that does not require winning a single new client.
Our calculation
Why the lender, not the buyer, sets the price of a CPA practice
Almost every owner-operated accounting practice is bought with an SBA loan. That loan has to be serviced out of the practice earnings after the new owner has paid themselves, and the buyer of an accounting practice is nearly always credentialed, so the salary they have to draw is high. Below is what the loan will actually support on the published median SDE of $208,303, at ten year amortization, 10.5 percent, a 10 percent equity injection and a 1.25x debt service coverage requirement.
| Buyer takes a salary of | Left for debt service | Maximum annual payment at 1.25x | Supportable loan | Maximum price | Implied SDE multiple |
|---|---|---|---|---|---|
| $75,000 | $133,303 | $106,642 | $658,604 | $731,782 | 3.51x |
| $100,000 | $108,303 | $86,642 | $535,087 | $594,541 | 2.85x |
| $125,000 | $83,303 | $66,642 | $411,571 | $457,301 | 2.20x |
| $150,000 | $58,303 | $46,642 | $288,055 | $320,061 | 1.54x |
This is the most useful table on the page for anyone about to negotiate. A buyer paying themselves $125,000, a normal salary for an experienced CPA, can finance 2.20x. The median practice sold at 2.04x, just underneath it. At $150,000 the ceiling falls to 1.54x, which is below the median. The upper quartile of 2.66x is not financeable at all on these terms at a credentialed salary.
That single constraint explains most of what is strange about accounting practice deals. It is why sellers carry notes, why so many transactions pay out over two to three years on collections retained, and why the buyer who pays the upper quartile multiple is usually a firm buying for capacity rather than an individual with a loan. A capacity buyer does not have to pay a second salary, because they already employ the people who will do the work.
It also explains why the one times gross fees rule has survived. One times gross fees on the median practice is $400,000, which is 1.92x the median SDE, comfortably inside what an SBA lender will fund at a $125,000 salary. The folk rule is not just close to what earnings support. It happens to be close to what a bank will lend, which is why deals priced on it keep closing. Two times gross would not be financeable at all. Our guide to using an SBA loan to buy a business works through the qualifying side of this in detail.
Our calculation
Bigger practices are worth more and earn less per dollar of fees
Dividing the revenue multiple by the earnings multiple returns the SDE margin the market is implicitly assuming at that point of the distribution. Because this source publishes both multiples at all four quartiles, and separately for asking and sold, the calculation can be run eight times and checked against itself.
| Point in the distribution | Implied margin, asking multiples | Implied margin, sold multiples | Difference |
|---|---|---|---|
| Lower quartile | 56.0% | 57.1% | 1.1 points |
| Median | 49.6% | 50.0% | 0.4 points |
| Average | 48.8% | 48.0% | 0.8 points |
| Upper quartile | 43.9% | 44.0% | 0.1 points |
Two things fall out of this table. The first is a validation: the margin implied by the asking multiples and the margin implied by the sold multiples agree to within about a point at every quartile, and to a tenth of a point at the top. Those are four pairs of independently reported numbers, and they are internally consistent. It is reasonable to trust this dataset.
The second is the finding. The implied SDE margin falls steadily as practices get bigger, from 57.1 percent at the lower quartile to 44.0 percent at the upper quartile. That is not a decline in quality. It is what happens when an owner stops preparing returns and starts paying staff to prepare them. The small practice keeps more of every fee dollar because the owner is the labor; the larger practice keeps less per dollar but has far more dollars, and sells for considerably more in total.
This matters when you benchmark yourself. A $250,000 practice running a 57 percent SDE margin and an $800,000 practice running a 44 percent margin are not a good business and a mediocre one. They are the same business at two stages, and the second is worth roughly twice the first. If you are comparing your margin to the reported sector figure of 52.1 percent, compare against your own size band instead. Our profit margins by industry page has the wider sector context.
A note on why the implied median margin of 50.0 percent does not exactly equal the reported 52.1 percent. The reported margin is median owner earnings divided by median revenue, taken across the whole population. The implied margin is derived from multiples calculated per transaction and then summarized. Those are different operations on a skewed distribution and they are not required to agree. A 2.1 point gap between them is small; where this identity breaks badly it is a signal, and there is an example in the peer table below.
Our calculation
Accounting practice prices rose 25 percent, and almost none of it was re-rating
Headline sale prices are the least informative number in any of this data, because a rise can mean buyers are paying more per dollar of earnings or simply that larger practices came to market. The source publishes revenue, earnings and both multiples per year, so the two can be separated.
| Year | Median revenue | Median SDE | SDE margin | Avg earnings multiple | Avg revenue multiple | Median sale price | Days on market |
|---|---|---|---|---|---|---|---|
| 2021 | $388,991 | $160,000 | 41.1% | 2.17x | 1.03x | $400,000 | 124 |
| 2022 | $400,000 | $212,149 | 53.0% | 2.20x | 1.08x | $414,100 | 156 |
| 2023 | $422,903 | $199,966 | 47.3% | 2.28x | 1.04x | $417,750 | 172 |
| 2024 | $331,542 | $204,059 | 61.5% | 2.08x | 1.04x | $332,500 | 166 |
| 2025 | $440,000 | $246,797 | 56.1% | 2.34x | 1.11x | $500,000 | 169 |
Across the five years the median sale price rose 25.0 percent. The earnings multiple rose 7.8 percent and the revenue multiple rose 7.8 percent. Median revenue rose 13.1 percent while median owner earnings rose 54.2 percent, taking the SDE margin from 41.1 percent to 56.1 percent. So the rise in accounting practice prices is overwhelmingly a profitability story, not a valuation story. Fee increases, automation and offshored preparation dropped to the bottom line, and buyers paid for the earnings rather than re-rating the sector.
That is a different mechanism from the two neighbouring trades we hold the same data for. In insurance the headline sale price rose 160 percent while the earnings multiple fell 24 percent, so the whole rise was larger agencies coming to market. Here the multiple held roughly flat and the earnings genuinely grew. Three sectors, three different explanations for a rising headline price, which is why the headline on its own is worthless.
The 2024 dip is worth reading properly because it looks alarming. Median sale price fell 20.4 percent that year. Median revenue of practices sold fell 21.6 percent over the same period while median earnings rose 2.0 percent and the revenue multiple did not move at all. Smaller practices came to market, and they sold for less because they were smaller. The market did not de-rate. In 2025 it went the other way, and the 50.4 percent jump in median sale price decomposes to roughly 62 percent bigger practices and 38 percent genuine re-rating, with the earnings multiple reaching 2.34x, the highest in the series.
The last column is the quiet one. Days on market rose from 124 in 2021 to 169 in 2025, up 36 percent, while the sale to ask ratio never left the 0.95 to 0.99 band. Practices are taking a month and a half longer to sell without sellers conceding any more on price. That is the signature of a thin buyer pool rather than a weak one: the constraint is finding somebody with the credential and the financing, not agreeing what the practice is worth once you find them.
Our calculation
Why one source says 2.75x SDE and this one says 2.04x
If you research this subject for an afternoon you will meet a widely quoted figure drawn from a set of more than 600 accounting practice transactions: a median of about 1.0x revenue or 2.75x SDE. Our closed data agrees on the first and disagrees sharply on the second. Both cannot be describing the same practices, and the margin arithmetic shows exactly where they part company.
A practice selling at 1.0x revenue and 2.75x SDE has an implied SDE margin of 36.4 percent, because 1.00 divided by 2.75 is 0.364. The practices in this dataset run a 50.0 percent implied margin, and a 52.1 percent reported one. The two sources are not contradicting each other about price. They are describing practices with different cost structures, and the revenue multiple is the same in both because the difference in earnings is exactly offset by the difference in multiple.
Which one applies to you is decided by your own margin, not by which article you read. A staffed practice keeping 36 cents of every fee dollar is worth roughly 2.75x those earnings. An owner-operated practice keeping 50 cents is worth roughly 2.04x. Both land near one times gross fees, which is why the folk rule works across a range of practices that look very different on a P&L, and why it is the only figure in this field that everybody agrees on.
The general form is worth keeping: revenue multiple equals SDE margin multiplied by the earnings multiple. Whenever two published valuation figures for the same sector look incompatible, run that identity on both. It usually shows they are measuring different businesses rather than making different claims, which is the same test we use on the business valuation multiples by industry hub.
Peer set
Accounting practices against the rest of financial services
Same platform, same five years, same definitions. The margin column is ours, computed as median earnings divided by median revenue, because it is the column that explains the two either side of it.
| Sector | SDE margin | Avg revenue multiple | Avg earnings multiple | Sale to ask | Median sale price |
|---|---|---|---|---|---|
| Insurance agencies | 55.8% | 1.52 | 2.86 | 0.92 | $497,500 |
| Check cashing businesses | 52.2% | 0.89 | 1.82 | 0.92 | $159,000 |
| Accounting and tax practices | 52.1% | 1.07 | 2.23 | 0.97 | $425,000 |
| All financial services | 51.1% | 1.19 | 2.42 | 0.95 | $450,000 |
| Other financial services | 40.9% | 1.33 | 2.89 | 0.91 | $732,500 |
| Banking and loan businesses | 34.1% | 0.89 | 1.61 | 0.90 | $1,500,000 |
| Law firms and legal services | 30.6% | 0.72 | 1.96 | 0.90 | $500,000 |
| Medical billing businesses | 29.3% | 1.24 | 3.63 | 1.01 | $500,000 |
Read the margin column against the revenue multiple column and the sector ranking stops looking mysterious. Insurance agencies and accounting practices both convert more than half of top line into owner earnings, and both clear above one times revenue. Law firms convert 30.6 percent and clear 0.72x. Nobody is rating lawyers below accountants. Buyers are paying a broadly similar price for a dollar of owner earnings across the whole table, and the revenue multiples differ because the margins do.
The row that breaks the pattern is instructive. Banking and loan businesses report a 34.1 percent margin but their multiples imply 55.3 percent, a gap of 21 points where every other row sits within 2 to 6 points. That is not an error in the data, it is a warning that the category is too heterogeneous to summarize: its median revenue is $2.79M against a $425,000 median for accounting, so the median revenue and the median earnings are coming from very different businesses. When this identity breaks by that much, stop trusting the sector average and look at the individual transactions.
Accounting also holds the tightest sale to ask ratio of any category with a normal size profile, at 0.97. Medical billing is the only row above it, at 1.01, and that is a small, unusual category where practices close slightly above asking.
Buyer types
Who buys accounting practices, and what each one pays
The multiple you should expect depends almost entirely on which of these is sitting across the table. The first two rows are the closed-transaction data on this page read two different ways. The last two come from advisor and deal-platform reporting for 2026 and are kept separate on purpose, because mixing them produces a number that describes nobody.
Another CPA buying the practice
About 0.92x to 1.17x gross fees, median 1.02x
The classic succession sale, usually financed with an SBA loan and a seller note. This is what the closed-transaction data on this page describes.
Individual buyer, priced on owner earnings
1.61x to 2.66x SDE, median 2.04x
The same transactions read the other way. Because the buyer must also pay themselves a credentialed salary, the lender caps the price well before buyer appetite does.
Regional firm buying for capacity
Commonly quoted around 0.85x to 1.15x annual revenue
A neighbouring firm absorbing your client base and often your staff. Frequently structured on collections retained over two to three years rather than a fixed price.
Private equity backed platform
About 4x to 7x adjusted EBITDA
Reported for firms generally above roughly $2M to $3M of revenue. Adjusted after partner compensation is normalized to a market salary, which shrinks the earnings the multiple applies to. Consideration is usually cash plus rollover equity plus an earnout.
The private equity row is the one that has changed most recently and the one most likely to be misapplied. Capstone Partners reported that financial acquirers made up 54.8 percent of accounting services M&A activity year to date in July 2026, with deal volume involving those buyers up 69.1 percent year over year. That is a genuine structural shift in who owns accounting firms in the US, and it is being reported in a way that leads practice owners to expect platform pricing.
It will not apply to most readers of this page. Platform buyers are reported engaging above roughly $2M to $3M of revenue, and the median practice in the closed data bills $400,000. There is a real gap between the two, and a practice in it is worth more on a platform multiple than any individual buyer will pay, to a buyer who will not return the call. If you are approaching that threshold, the difference between selling at $1.8M of revenue and at $3M of revenue is not one multiple, it is a different buyer pool.
Value drivers
What moves an accounting practice within the range
Recurring fee base
The share of fees that recurs without being re-sold each year is the first thing a buyer measures. Monthly bookkeeping, payroll and write-up work supports the top of the range. A practice weighted toward one-off project work and individual tax returns that walk in during season sits at the bottom of it, because the buyer is purchasing a habit rather than a contract.
Client retention through the transition
Accounting clients follow people. Buyers price the risk that they do not follow the sale, which is why almost every deal carries a retention adjustment or a look-back on collections. A documented, staged handover with the outgoing owner introducing clients personally is worth more than any other single item of preparation.
Owner dependence
If the owner personally prepares and reviews most of the work, the practice is a job with a client list attached. Where staff own the relationships and the review function, the buyer is acquiring a business. This is most of the gap between the lower and upper quartile.
Client and industry concentration
A handful of clients driving a large share of fees is priced as risk, and the discount comes off the multiple rather than off the revenue. The same applies to a book concentrated in one industry that is itself cyclical.
Service mix and realization
Advisory, monthly accounting and niche compliance work carry better realization than commodity individual returns, and they price better because they are harder to replace. Buyers look at fees per client and at how much of the fee base has been repriced in the past three years, since an underpriced book is both an opportunity and a sign the relationship will not survive a fee increase.
Staff who stay
A seasonal team that returns each year, and a manager who can run the review, materially changes what a buyer will pay, particularly a firm buying for capacity in a market where hiring is the binding constraint. Employment agreements and a compensation structure that survives the sale are part of what is being valued.
Before you list
How to raise your accounting practice valuation before you sell
The $218,718 between the quartiles is the prize, and it is won in the two years before the listing rather than in the negotiation. Nearly everything on this list answers the same buyer question: does the fee base renew without you in the chair?
- Move client relationships onto named staff. This is the highest-value item and the slowest, which is why it goes first. A practice where the owner reviews everything and signs everything is priced at the bottom of the range no matter how good the numbers look. Assign a manager to each significant client, introduce them properly, and let them be the person the client calls.
- Separate recurring fees from project fees in your reporting. Buyers pay differently for monthly bookkeeping, annual compliance and one-off consulting. If your practice management system blends them into one revenue line, a buyer will assume the least favorable mix. Split them at least one full year before you list so there is a clean comparative.
- Reprice the underpriced clients now, not at the closing table. An unrepriced book is discounted twice: once for the low fees and again for the risk that raising them costs the client. Do the increases yourself, absorb whatever attrition comes, and list a practice whose fees have already been tested.
- Publish realization and retention. Fees billed against fees collected, client counts retained year over year for three years, and revenue per client. Most sellers assert these and cannot support them, and an unsupported number gets treated as the worst plausible one.
- Fix what concentration you can. You cannot un-win a large client, but you can grow around one. Concentration is priced as risk and it comes off the multiple, not off the revenue, which is why it is expensive out of proportion to the fees involved.
- Sort the technology before diligence, not during it. A practice on current cloud software with clean workpapers and documented processes transitions faster and prices better than one where the knowledge lives in the outgoing owner. This is also where a capacity buyer looks first, because they are deciding whether your clients can be absorbed into their systems.
- Decide what you will carry. Given the financing ceiling above, some seller note or collections-based earnout is likely. Deciding in advance how much you will carry and on what terms is worth more than arguing about the headline multiple, because the terms are where the real price is set.
Run your gross fees and owner earnings through the estimator at the top of this page to see where you currently sit, then read how to increase business value before selling for the longer playbook. When a sale is close, the best way to sell an accounting practice compares the CPA succession, capacity-buyer and private equity routes on what each actually nets.
Questions
Accounting firm valuation questions people actually ask
How much is my accounting practice worth?
Most accounting practices are worth roughly 1.61x to 2.66x seller discretionary earnings, with a median of 2.04x, which works out to about 0.92x to 1.17x annual gross fees with a median near 1.02x. A practice billing $500,000 with $250,000 of owner earnings typically lands somewhere between $403,000 and $665,000, depending on how much of the fee base recurs and how much of the work you personally do.
What is the rule of thumb for valuing an accounting practice?
One times annual gross fees, and it is the rare rule of thumb that survives contact with the data. Across five years of closed US sales the median accounting practice sold at 1.02x revenue, so the traditional figure is off by about two percent. Most practices trade between 0.9x and 1.2x gross fees, which is very close to the 0.92x to 1.17x interquartile range in the closed transactions.
Is an accounting practice worth one times gross fees?
For a typical owner-operated practice, yes. The median closed sale was 1.02x annual gross fees, and the middle half of practices sold between 0.92x and 1.17x. Where one times gross goes wrong is at the edges: a compliance-heavy book that the owner personally prepares justifies less, and a practice with recurring monthly work owned by staff rather than the owner can clear the upper quartile comfortably.
How much do accounting firms sell for?
The median accounting and tax practice sold in the US over the five years to 2025 went for $425,000, against a median asking price of $449,000, after a median 162 days on the market. Median gross fees of practices sold were $400,000 and median owner earnings $208,303. The middle half of practices sold for roughly $335,000 to $554,000 on those earnings.
How are accounting firms valued?
Two ways, and which applies depends on who is buying. A CPA buying a practice prices either a multiple of annual gross fees, around 1.0x, or a multiple of seller discretionary earnings, around 2.04x, and those two routes give almost identical answers. A private equity backed platform prices adjusted EBITDA, measured after partner pay is normalized to a market salary, at a reported 4x to 7x.
What multiple of EBITDA do accounting firms sell for?
Private equity backed platforms were reported buying accounting firms at roughly 4x to 7x adjusted EBITDA through 2026, generally at firms above $2M to $3M of revenue. Those multiples apply after partner compensation is normalized down to a market salary, so they attach to a much smaller earnings figure. The typical Main Street practice, at $208,303 of owner earnings, is priced on SDE instead and sells at about 2.04x.
How long does it take to sell an accounting practice?
The median practice sold on the open market spent 162 days listed, so plan on roughly five to six months from listing to close, plus preparation in front of that. That is faster than the median insurance agency at 186 days and the median dental practice at 215 days. Time on market has lengthened by 36 percent since 2021 while the price concession has not widened at all.
Why are private equity firms buying accounting firms?
Because the work is recurring, the client relationships are sticky and the sector is fragmented enough to consolidate. Capstone Partners reported that financial acquirers accounted for 54.8 percent of accounting services M&A activity year to date in July 2026, with deal volume involving those buyers up 69.1 percent year over year. That buyer only appears above roughly $2M to $3M of revenue, which is well above the median practice on this page.
Should I sell my accounting practice to private equity?
Only if you are big enough for a platform to take the call, and only if you are comfortable with the structure. Platform deals are quoted at 4x to 7x adjusted EBITDA but pay a meaningful part in rollover equity and earnout rather than cash at close, and they normalize your compensation to a market salary first. Below roughly $2M of revenue the realistic buyer is another CPA, and the price is about one times your gross fees.
How much does an accounting firm valuation cost?
A formal appraisal from a credentialed valuator generally runs $2,000 to $10,000 depending on scope, and a calculation engagement commonly costs $1,500 to $8,000. Practice brokers often provide an opinion of value at no charge when you engage them to sell. That is useful information but it is not an independent appraisal, and it comes from someone whose fee depends on the sale happening.
Last updated September 2026
Asked another way
What owners ask when they are deciding, not researching
These are the questions that come up once the numbers are understood and the decision is the actual problem. Answered against the same closed-transaction data as the rest of this page.
Is now a good time to sell my accounting practice?
The pricing is the strongest it has been in the five years of data. The average earnings multiple reached 2.34x in 2025, the highest in the series, and the median sale price hit $500,000 against $400,000 in 2021. What has changed against you is time: practices now take a median 169 days to sell, up 36 percent since 2021. Price discipline is good, the buyer pool is thin, so start earlier than you think you need to.
Should I sell my accounting practice to another CPA or to a firm buying for capacity?
A capacity buyer usually pays more and is the more likely route to the upper quartile. They are absorbing your clients and often your staff, and because they already employ the people who will do the work they do not have to fund a second salary out of the practice. An individual CPA is capped by what an SBA loan will service after they pay themselves, which on the median practice is about 2.20x owner earnings at a market salary.
How do I know if my accounting practice is worth more than one times gross fees?
Check your owner earnings margin and check who does the work. If you keep close to 50 cents of every fee dollar and staff own the client relationships, you are above the middle of the market. If the margin is high because you personally prepare and review everything, the practice is worth less than one times fees, because the buyer is purchasing a job. Recurring monthly work supports the top of the range; walk-in seasonal returns do not.
What do people say about selling an accounting practice?
We do not aggregate reviews and we would rather point at checkable facts than repeat anecdotes. What the closed transactions show is consistent: practices close at 97 percent of asking, the tightest discipline in financial services, and the middle half sell between 0.92x and 1.17x gross fees. The complaints that show up in practitioner forums are usually about structure rather than price, specifically seller notes and retention clawbacks, which is where the real money in these deals is decided.
Is a business valuation worth it before selling my accounting practice?
It is worth knowing your number before a buyer tells you theirs, and that does not have to mean a $5,000 engagement on day one. Start with a benchmark against closed transactions to see whether you are near the median or the upper quartile, because that answers whether to list now or spend two years moving client relationships onto staff. Commission a formal appraisal when you need something defensible for a partner buyout, a lender or the IRS.
Benchmarks behind the estimate
Find out where in the range your practice sits
Enter your gross fees and owner earnings and read a value range against real accounting practice sales. An educational estimate, not a certified appraisal.