Bidding on a job!

[Roberts]

I had a prospective client walk into my office today and wanted me to bid on his tax preparation. He pulls out all the info - it's basically 2 binders of hand written accounting for his real estate business. He sells homes but also has 40 rental properties in those binders.

I reviewed it quickly, noticed it was actually in pretty decent shape and wrote out an estimate with some expectations and variables.

He looked at my bid, laughed, picked it up and said "My current accountant will do it for $500, why should I use you?"

I noticed the $500 bill in the paperwork and noted the accountant hadn't actually taken a deduction on the return for $500 as an expense. In fact, he missed multiple normal expenses like telephone, rent, postage which were all in the paperwork but not on the return.

He says he's going back to the accountant for $500. I know for a fact the accountant died 3 months ago. That was an interesting 40 minutes I'll never get back!

[JohnH]

Sounds like you priced it too low.
You need to price it high enough to make 'em CRY, not LAUGH.

[DTS]

Quote

Seriously, I would have quoted that idiot "$5,520, which includes the state return free of charge"...

[geekgirldany]

Dang 40 rental properties.... I would have quoted him out of the office. I have a guy that balks at my $500 bill for doing 6 rental houses. He called me this year wanting to know if I would be able to do it. I told him yes I would. He then went into this long thing about how I was the only person doing the work, I was late with his return last year because of it, etc.

I told him I wasn't late with his return... he brought it the first of April and I told him I would not have it completed by the 15th. Plus he also drags his feet on getting expenses to me. I ended the conversation telling him if he thinks I don't get it done quick enough then to go to another accountant.

Haven't heard from him yet.

[DTS]

Dang 40 rental properties....

That's what I did Dany, quoted my price per rental at $138. I'm sure he couldn't tuck-tail and run out fast enough!

[BHoffman]

I know for a fact the accountant died 3 months ago.

Geez, the guy probably starved to death.

[DaveO]

I usually quote the window shoppers at $100 min plus $25 per form or schedule added. So 1040 plus "A" and "C" with 40 rentals would be $1150 if everything was in good shape. Likely there would be a "B' and "D" and maybe a 6251 too.

[Lion]

40 Rentals!

And, a first year set-up fee of $1,000. 40 rentals! How many lines on the depreciation schedules? Are they all in the same state? I'd have also told him new clients this late in the season go on extension, so I can go over their prior year returns thoroughly after tax season to make sure we get all their carry forwards, etc.

[JohnH]

I probably shouldn't say this because I'm painting with a broad brush, but my experience with people who own multiple rental properties in general has not been good. Generally, the ones I've known seem to conduct business as though everybody owes them something and they want everything on the cheap. Maybe that's a necessary mindset in that type of endeavor. I know that not every landlord type fits this profile and I'm sure some of you have good clients in this category, but that has been the typical interaction I've had with them.

[Snaggletooth]

Bidding on Work

I know for a fact my prices are overly-reasonable, maybe not even fair to myself, but I have a low-overhead operation and make more from my low price than others make on double the fee.

I don't "bid" on work. Generally, people who ask you do this are attempting to scrape their expenses - not really a bad idea on the face of it. But most of such people make a ton of money and expect their vendors/contacts to work for nothing. And they will complain about any conceivable item on your bill.

I don't have any secrets, and don't mind explaining to curious people the reasons why I operate the way I do. But my experience with people who up front try to negotiate my fee is that these people will be contentious clients.

[luke]

couldnt

agree more with Snags....