[Question] Maximum Payment for Referrals

[Tomekia Lloyd]

Hi Folks,

I am proud to say that I had a very successful meeting with a very profitable Accounting and Tax Firm today! It looks like I may have scored on this one. It turns out that I hate taxes and need someone to take this over and they hate bookkeeping and are looking for someone to refer out to.

Here's the question:

The deal we worked out was that I receive 25% of the fees for all customers I send to them for tax preparation. They receive 25% of the fees for all customers they send to me for bookkeeping projects. In their words, their goal this upcoming tax season is to do no bookkeeping.

Big question is... for monthly bookkeeping agreements referred by their firm, what is a reasonable time frame that I should cut off paying referral fees.

For example. I pay 25% of bookkeeping fees, up to 6 months.

What do you all think, since I've never encountered a situation like this before? Please consider what would be fair from both sides of the table.

Thanks folks, I know I can count on you all to help me think this through.

[Essential Office Solutions]

Wow - good question - I don't have any idea but would be very interested in what the others say and you decide.

Keep us posted - good luck sounds like you could get plenty of business.

[debhowardgreenleaf]

Tomekia: In my experience, 12 months is a common cutoff for referral fees.

Good luck!
Deb