Average Preparer fee is $258

[FEDUKE404]

Very interesting.....

For 1040 and 1040A I bill by the form plus an hourly charge if I have to do any sorting of any mess. Average fee for 1040A with EIC is $175 - $200. For 1040 with C or F and Depreciation is $250 - $325.

Those must be some "Texas" prices.

Around here I would soon be out of business for charging that much for a routine 1040A - and that also includes the state tax return which I assume is not a regular issue in TX nor in the prices you have quoted.

FE

[Jiggers]

For 1040 and 1040A I bill by the form plus an hourly charge if I have to do any sorting of any mess. Average fee for 1040A with EIC is $175 - $200. For 1040 with C or F and Depreciation is $250 - $325.

But the 1040 could be more, if they are very large C or F returns and all the related schedules and forms.

For 1041, 1065, 1120 and 1120S I bill by the hour.

[joanmcq]

I tend to charge by the form, but I've got an idea of how much time those forms take, as well as the risk involved in a Sch C, E or F if the client is giving me the figures. I ask questions, but then again, the audit risk is still there for those forms. Some forms I don't charge for if I do no work on them...for example a Sch D that only has flow through items on it. I will adjust billing up and down depending on extra time. However, for corporate, partnership, my client with TWO forms 5471 with all related schedules, and shoeboxes stuffed full of receipts I charge by the hour.

[FEDUKE404]

And furthermore...

Years ago I used to prepare returns for several waiters and bartenders who lived quite well on $4,000 per year.

....as were many construction workers and auto mechanics and electricians who barely made minimum wage.....

FE

[JohnH]

Years ago I used to prepare returns for several waiters and bartenders who lived quite well on $4,000 per year.

[Gary2]

Now, different questions.. .If the child (still in high school) makes $4K this year can the parent still take them as a dependent? I've always done so... But this appears to be a gray area...

Other than unusual circumstances (like not living with parents), the key issue would be whether or not the child is paying more than half of his or her support. I can't imagine doing that on $4K, unless the student is also living off the land.

[Lion]

Dependent

For a child of the age you mention, the only support test is did the child pay more than half his own support; so in my area a child earning $4,000 will still be his parents' dependent.

For the main topic, my fees in pricey Fairfield County, CT, are higher than the norm; but the returns are plenty complex, too!

[origun]

Do average prep fees include state or only federal?

I was wondering...does the IRS average only include doing a federal return? The cost for a state return can make quite a difference. Our billing program bills about $40 for our home state (Oregon) but out-of-state returns (especially CA) are more expensive. And then we get new clients from NV or WA or TX (to name a few) who have never paid for a state return and are surprised to see the jump in fees because of a state return for the first time.

Also, in response to the comment/question about dependent returns: we have the option of doing quite a few "friends and family" returns for $22 so some of those dependents suddenly become my "friends." Or in some cases, I'll just pencil in the figures on a 1040EZ and give to the client with an envelope and tell them to finish and mail it in. I don't like to gouge the high school and college kids and if I can build some good will, they might be back when making big bucks in the future!

[MAJ]

Average Costs...

While I do charge by form there are many forms I do NOT charge for.as well.
I charge for the primary forms (1040, Schedules A,B,C,D,E,etc).
There are many smaller forms that I do not charge for as well.

On average I would say my bill runs about $125 - $150 (long form). I have NOT raised my prices in two years in part due to economic conditions (I'm an idiot - Don't remind me!).
My smaller clients (1 W2, etc) usually only pay $80 (students, etc)..

This method many times is NOT fair since some clients are bing, bang, done.. While others tend to take longer - much longer. I did implement indificual pricing for stock trades and other time consuming changes... But sometimes, the amount of time spent does not justify for me. I've been thinking about this alot and don't know if I can change to any hourly rating. For some - Maybe..

Question - What do you do iwth the child just starting to work - Still in High School and has a single W-2 - Do you charge the going rate or give them a break? I always give them a break and sometims too much so... I think $40 is more than fair with EFile.

Now, different questions.. .If the child (still in high school) makes $4K this year can the parent still take them as a dependent? I've always done so... But this appears to be a gray area...

Thanks

[oceanlovin'ea]

My fees are less but that is the perk to being your own boss, working out of my home, knowing my clients and what they can afford. Some returns are more and most are less.

I worked for HRB for 15 years before I started out on my own. I learned a great deal while working there. I worked in an office with several extremely competent preparers. We had new people come in.....some learned well and some were terrible. We helped those that wanted to learn just like others helped us. We had our clients and we sent them cards each year thanking them for their business and reminding them to come back to us. Most of our clients asked for us when they made appointments or came in. Some didn't...either they just didn't care who did their return or they didn't like us (who knows). If you had a GOOD receptionist in the office, she would try to make sure people with more complex returns got experienced preparers. But on the other hand, I got some pretty hard returns the first couple of years I worked and I asked questions and got help and they all passed the checking department.

So I agree that you can get experienced and novice preparers anywhere. That is why referrals are so great.

Linda, EA

[origun]

Block's scheduling

Having worked at a Block corporate office for 14 years, the policy has always been to give clients their choice of preparers if they have a preference. (About 75% of my clients each year are returning clients.) If they are a new client, the receptionist inquires about the complexity of the return and tries to place client with an appropriately qualified preparer. Of course, the placement doesn't always work out as intended...but I have observed that my inexperienced colleagues are always willing to refer a client with a return beyond their competence to another preparer.

[Black Bart]

You've got a point, origun

Block has a lot of novice preparers doing fairly basic returns. Probably many of you started out working there! However,that doesn't mean that there aren't eminently qualified preparers at Block. A lot of us are EAs and have many years of experience. I have some major disagreements with some of the corporate policies (such as pricing...as mentioned in previous post) but do resent the implication that I am not as qualified as some of the rest of you just because of where I work.

Our local HRB does good work -- customers occasionally bring in last year's Block copy and I have yet to see anything wrong (makes me wonder what they think about mine -- I'm sure they have some copies).

But erchess has a point about choice of reps. Most clients probably won't know who's good/who's not, but if they do, does HRB allow them to choose?

It seems a matter of luck no matter where you go. As John rightly pointed out, some pricey credentialed folks will give you no better treatment on purpose than a Block novice does accidentally. And going to a one-person independent may narrow the odds, but doesn't guarantee it won't be handed off to an "in-training" spouse/kid/relative.

[taxxcpa]

Fees

My average price is probably about $ 150 which includes a lot of returns that only take thirty minutes or less. Some are returns for corporations for which I keep the books, so my total fees will be over $ 1000 for the year, but with a set of books that I keep, the return itself takes less than an hour.
I've let my computer calculate my fee at $ 150 or $ 200 per hour, but then I change it to what I think is a proper fee -- which often is higher than the per-hour fee, but is sometimes a lot less if I think I'm taking too long or if I have a one-time extra amount of work for a client whose return normally takes less time.

Billing by the form almost always creates a very high fee since a lot of pages may result from just one or two data entries. Tax Shacks generally charge by the form, so their fees are high.

[erchess]

More Qualified than

Far be it from me to judge between Origun and Taxea as to who is more qualified. Certainly there are very qualified people at HRB. The problem as I see it with HRB or any large firm is that unless you know of someone good to ask for by name you could end up with someone who lacks the experience and training to do your return. In my opinion, the client runs less risk of incompetence by going to a one office practice that is owned and supervised by a Practitioner and preferably one who works alone or with only one or two others. Don't go to a larger firm unless you know which person to ask for. Just my opinion fwiw.

[FEDUKE404]

A bit high for me

While I have many returns that far exceed the "average" price quoted, the reason for such a price is that they are doggone complicated returns.

OTOH, I still prepare numerous returns (including a fair amount for senior citizens) that come nowhere near that price. Same idea for the relatively few "simple" returns I receive from the younger crowd - many potential clients within that group prefer going the TurboTax route unless/until they encounter an extremely challenging return.....or receive one of "those" letters from the IRS.

One question: Does the average fee cited include what many people pay for "quick" refunds et al? Including such as actual tax return preparation costs can skew the numbers upward.

FE