How Do We Charge?

We do charge by the form. We’ve tried doing flat-fee “transparent” pricing, but a problem surfaced…It was almost impossible to do it right. Why? A couple of things:

1. It’s not fair to charge someone with 2 forms the same as someone with, say, 6 or 10 forms.
2. Clients don’t realize they have or need certain forms until their appointment interview uncovers the need for additional, perhaps complicated IRS documentation.
3. Every form requires knowledge of a different section of the tax code. If you don’t know the ins and outs of the form, refund money can be left on the table (we recently redid tax returns for 3 years saving more than $21,000 for one client whose previous accountant was unaware of the loophole).

• Every form takes time to prepare, proof, set up for e-filing, print and more importantly, defend in an audit or result in an IRS letter of some kind requiring follow up.
• We will give you an estimate in advance, update you in the middle, and we do our best to stick to the quote. BUT – if you throw a lot of extra paperwork at us or, through the course of an interview, it becomes obvious the return is more complex than originally discussed, and maybe there is a completely better way to do the return that can save you tons, we might have to have a little heart to heart to determine what is fair.
• We won’t charge you for forms that aren’t mandatory and/or that don’t more than pay for themselves.

We do charge extra for a few things…

• We do charge $75 for extensions as they have to be tracked and acknowledged through the IRS and Franchise Tax Board and if that gets messed up, you will yell at us. You must call in to request an extension. We do not do this automatically anymore as it became difficult to manage as we grew.
• We do charge $20 for each extra copy of a return you request either digital or paper. You get one copy of either a digital or a paper return with your service. We are not icloud or one drive, and we do not offer filing keeping or document storage services. You should keep your tax return for 5 years in a safe place. Extra copies use to be at no charge, but after rushing to drive to the office a bunch of times and no one shows to pick it up, we end up putting on our business hat and charging.

rough pricing estimates

EZ

With the new tax code changes, there are technically no “EZ” or 1040A forms any more. Every one of us is on a Form 1040 now. But we all know what an “EZ” is. It’s just W2s and/or unemployment income—no children, no anything else. These run about $130 for both Federal and State, $25 more if you get the EIC credit. This fee includes tracking the Federal and State returns for acknowledgements and includes all the other additional services you get with us including preparing a budget template you can use for life and complementary consultations should something change in your work or life situation, and recalculating and revising W4 forms for your employers if necessary and the like.

We encourage you to do “EZ”s yourself. EZ returns aren’t really our chief money maker. However, this is a good time to get to know a tax professional BEFORE your life changes and becomes more complicated whether due to marriage, children, college, divorce, investments, inheritance and/or retirement. And many people who think they are EZ overlook things, now more than ever with the new tax code that took over in 2018 and all the COVID-19 tax regulation changes, stimulus payments, unemployment payments, etc.

MEDIUM

Formerly knows as 1040As, these will be on Form 1040 wherein the tax payer has child dependents and/or can qualify for tax credits. These tend to run in the $200-$300 range depending on how many credits you are entitled to because of your unique life situation like writing off interest on college loans, teacher expense credits, education credits, child tax credits, charity credits, stimulus credits and the Additional Child Tax Credit. (EIC credit is additional.)

This range is also for those with gambling income or other unique income forms like selling your personal residence or getting or cashing out an inheritance.

We will also work with you in forecasting upcoming life and income changes and being proactive with the tax code to save you money, avoid getting letters and strategizing retirement allocations.

COMPLEX

Formerly known as 1040 long forms, if you are on a long form, that means you are using what the IRS calls “Schedules” like Schedule A (home), Schedule C ( self-employment, 1099-Misc), Schedule D (investments), Schedule E (rentals, K-1s), Schedule F (farm income), etc. These vary significantly and many people need more than one schedule. This is where we can provide the most help and, usually over the course of our client relationship, we more than pay for ourselves in tax savings, tax strategies and in worry-free living. These typically start at $400 and go up from there.

Self-Employed/UBER/Lyft

These run about $375-$450 and include business use of car, business use of home, business meal deductions, depreciation of equipment (as needed), a thorough interview to get at all the deductions possible, and simple bookkeeping/data tallying. Be sure to bring in your tax forms from the Apps as well as printing out your annual work summary pages.

Rental Property Returns

These will run about $500-$650 depending on how your rental is managed and how title is held and whether you also are itemizing your own home ownership property tax and mortgage. It includes interviewing you thoroughly to capture all expenses, depreciation calculations, tracking depreciation and basis so when/if you are ready to sell the numbers are available to determine your taxable profit. It will also include the IRS required loss carry-forward forms and/or the very beneficial QBI Investment deductions.

Returns with Stocks and Investments

These can run from $350-$500 depending on the nature, number and type of stocks and investments you have and whether you are receiving K-1s and takes into consideration that usually tax payers with stocks and investments have a wide variety of other forms like interest, dividends, social security, and are also itemizing property taxes and home mortgages and such (if not, this will come in at a much lower price). Selling Crypto currency is the same as selling a stock and requires the same kind of documentation and is in this category.

LLC/Corporate Returns

These returns start at $650.00-$850 if they require a balance sheet. Prices will also vary depending on other forms required like depreciation for equipment purchases, sales of assets, owner ship transfers, etc. Reminder, unless you are a single-member LLC, these returns will require you to also file a separate personal return which given that it has a K1 in it as these returns do, will end up being a long-form personal tax return.

the caveats

Prices subject to change without notice. Some restrictions apply. Offers cannot be combined. Nominal bookkeeping at no extra fee. However, if ATS ends up hand-tabulating multiple bank statements and receipts, or logs on to accounts for multiple downloading of tax documents, an additional at cost charge will be added on. So, as always, it is best to come prepared.

Why don’t we charge a flat rate?

There is no incentive to a tax accountant to dig a little deeper, to spend extra time to interview you, to file the tricky but helpful forms, if the fee stays the same. It is also not fair to charge one person with 1 form the same as another with 10 forms.

“Flat rate” places tend to be “in and outs.” Don’t expect them to answer a lot of your questions, recommend any tax strategies or to spend time looking at several different scenarios to be sure you get the lowest possible tax liability. We amend (fix) many returns during the off-season prepared by these “in and outs.”

More and more accountants are trying to offer more price transparency (as are we) with sort of variable flat pricing. We do not mean to convey that these firms are in the above category.

Percentage of Refund

Whatever you do, please do not go somewhere that charges a percentage of the refund. Think about it…

How do they price their services if you owe to the IRS instead of getting a refund? What are they doing behind the scenes to increase your refund so they get paid more (then they disappear when you get audited)?

The IRS expects every tax office to have a certain ratio of returns owing money. If the office you go to has larger and more refunds versus average, do you think you might have a higher chance of getting audited?

It seems every other year, tax offices around us get shut down by the IRS for preparing returns with systemic tax fraud built into them that you may or may not even know the firm is doing! It’s good for our business, but it’s not good for the good ol’ U.S. of A. Integrity matters if you want to avoid IRS entanglements!

The Bottom Line