How much do your charge for doing college kids returns when you do the parents returns?? Years ago I used to do the kids return free when I did the parents but I start charging anywhere from $50 to $100 for Federal, State, and Local. The only thing most of these kids have is 1 W2 for several thousand dollars and are being claimed on the parent's returns but need to file for Federal to get small refunds back. Am I in the going rate for highschool and college kids??
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Generally minimal charge for dependent return
For what amounts to a simple 1040EZ or 1040A for a dependent child, I will either do it for free (somewhat dependent upon level of tax return for parents) or charge a paltry $25 or so. I see it as a goodwill gesture and, being realistic, the time I spend on such is minimal. Parents appreciate it also, so it can easily be a win/win gesture for both sides.Originally posted by marlenew View Post
Where I do draw the line is for a "complicated" return for a college kid, if such things as a Schedule D is involved, or even worse the infamous Form 8615. I still see red when my own children finally "outgrew" the need for the Kiddie Tax....and then a few years later Congress made them subject to it again as college students!!
Bottom line: Do what best suits your own personality and business interests!
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PITA rates apply
I usually charge $25 - $35 (no state or local required) if the parents are good clients. Got one right now where the dad called with a "quick question" cause he was doing Junior's himself to avoid my ridiculous aforementioned rates. "It's really so easy," he says, "I'll just do it myself, but is his standard deduction really x?"Originally posted by marlenew View Post
So, the next day he comes in to ask me another quick question about Junior's 1099-B. I told him I would rather do it for free than try to explain it to him. That shamed him into leaving it with me, "Oh, no, no, I will be glad to pay for it", and I will be charging more than $25.If you loan someone $20 and never see them again, it was probably worth it.Comment
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Dependent return
I generally charge $50 for a dependent return, but will charge nothing occassionally.Comment
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1040-EZ for a dependent of a fully pay client
Is gratis. Anything beyond 1040EZ, or if the client is already getting a discount on their return, or, if I just want the client to eventually go away but don't want to tell them that, the kid's return is charged like every other return.
UNLESS, I see that the kid will be much more successful than mom and dad down the road and will have a small biz or complicated returns, I will do it for free to get in good with the kid.Comment
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Generally, I charge $20 - $30 for a simple dependents return.
But the kid usually gets sticker shock when they are no longer a dependent and I charge them full price! How do you all handle that transition?Comment
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If I am doing parent's return then I do not charge for the student. I figured it's a good investment. After a few years of doing the return for the child I figured they would know me and use me to do their return when they graduate and are more able to pay. Not much cost to offer this service. Time to do return is ridiculously short and a less than a dollar of paper and ink. I've been using this policy for the 6 years I've been in business and I am now seeing the fruit of my labor. Was just thinking recently how many of my customers kids have now grown up and I am now doing their returns. It is really growing my business. This year I took it a step farther and offered to do free returns for high school students who played soccer with my grandsons. So far no takers on the offer. Actually I don't think a lot of them have jobs with the demands of sports but it was just another way to get the word out about what I do.Comment
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$40 for dependent return, W-2's only. That includes Fed, State, and City here in PA.
It's still not a money making deal. Between input, print/copy, e-file and signing, your looking at 15-30 minutes total for return and associated misc time.Comment
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Provide a bill showing full price, the dependent discount, and then the net price.Originally posted by dkss View PostComment
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The kids of my clients have kiddie tax, the state where they go to college and have a part-time job, their home state, etc. I show the full price on the invoice and give a discount. But, still charge around $100, sometimes less, sometimes more. $100-150 with CT, NY, and kiddie tax. If they didn't listen to me and fill out the state W-4s wrong and have to file the states because they had withholding, I charge $100-150. If they listened to me and no states, maybe only $50. I make it look in balance with the parents' return. If parents are $500 or more, I have no trouble charging $100-150 for federal, CT, NY, and kiddie tax. If the kid has lots of trades and a couple of K-1s from the trust funds his grandparents set up.... I have some kids with fat returns and $350 prices. Maybe I should charge by the pound!! And, I do add a Rush charge when they need the returns for the whole family fast to fill out FAFSA forms. If I have to rush out two trusts, two kids with all that investment income, and the multistate parents, I'm going to charge a lot.Comment
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Had a parent and child this weekend.
Child's Fed/State 1040-EZ was $54.Comment
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$35 -$40 for a student return.
9 - 10 years ago I did a return for some folks, and they asked about doing their high school age daughter's return and back then I think I quoted them $25. Dad said he'd do it himself. A few weeks later he called all in a panic over the letter she got from the IRS wanting to know why she was claiming EITC. I fixed it for them and after that dad didn't do any more returns and was happy to pay me for them.Comment
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Then what about the scenario, t/p file dependents return on TT or online, and they don't check the box - can be claimed on another return - they claimed the exemption on the child's return - then I complete and e-file the parent's return with the dependent and it goes "tilt" can not be accepted, lose dependency and possibly college credits and also have to paper file.
and I have to "clean all up" later - a larger charge than just the $ 25 - $50 I would have charged to prepare the "child's return" correctly.
Had two of those last year!
SandyLast edited by S T; 02-15-2013, 09:08 PM.Comment
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Btdt
When I was employed by "a recognizable name" (I don't want to give out any corporate secrets hereOriginally posted by S T View PostThen what about the scenario, t/p file dependents return on TT or online, and they don't check the box - can be claimed on another return - they claimed the exemption on the child's return - then I complete and e-file the parent's return with the dependent and it goes "tilt" can not be accepted, lose dependency and possibly college credits and also have to paper file.
and I have to "clean all up" later - a larger charge than just the $ 25 - $50 I would have charged to prepare the "child's return" correctly.
Had two of those last year!
Sandy
) tax firm I spent a lot of the down time in late Feb early Mar repairing such returns. It was normally just busy-work - parents would simply have to file a paper return (some would drop dependent, efile, then amend...but that could get costly). The kid would get stuck with going from 1040EZ to a 1040X, and normally with a check to IRS attached.
What was interesting is that, very frequently, the parental unit would step in to be very sure such a problem would not recur!
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These were long time clients I have had and one client even has a CPA degree and a CFO at some major company - She of all people should have known better.
I have always encouraged that I prepare the "kids/college or otherwise returns" but noooo with TT they just think they "know all the rules"
I rarely charge much or just a token fee to prepare - but just so much less expensive if I do, rather than to clean up "messes" a year or two down the road.
I really do like dealing with the notices and the Amended returns for something that could have been easily avoided.
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