Thread: Tax Return Cost
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Old 01-21-2013, 09:06 PM
britsteroni britsteroni is offline
LawnSite Senior Member
Join Date: Feb 2007
Location: Missouri
Posts: 334
I'm a CPA so I'll provide another viewpoint. To make sure we're on the same page, your asking for a price on preparing your schedule 1040 after receiving the K-1 from the business, correct?

Not trying to be critical, but asking this question would be similar to the guy who signs up for LawnSite and his first post goes something like this, "How much to charge for fall cleanups?" or "what's your minimum to drop the tailgate?"

What one CPA charges really isn't comparable unless you know the exact scope of the engagement from the CPA (i.e. Does the taxpayer itemize deductions? How many other separate forms are needed? etc.).

Contrary to what some others have said, if all you have is a K-1, a W-2 or two, and some itemized deductions, it really might be OK to use a service like Turbo Tax. If you are wanting a relationship with a CPA to utilize tax planning and strategy as well as folding this is with your business plans, then I think a relationship with a CPA might be a good idea.

This is just my opinion, but paying someone $600 to fill out a basic 1040 is outrageous. Now, your situation may be quite complex. You may also live in an area that has much higher cost of living. There is no way of knowing without more information. But most 1040's of normal difficulty might not take more than 1 hour to do. That includes the time it takes to manage the client relationship, prepare the return, e-file the return, and return a copy of the return and client documents back to the client.

The value is in the planning. There is no value in filling out tax forms. Filling out forms has become a commodity. Don't let anyone lie to you and tell you differently.

Some have mentioned the value of audit protection. This is a valid point (especially for your business returns). But most CPAs charge extra for that service unless it was a mistake made by the CPA. So if you fill out the forms and get audited, your fees for representation really won't change all that much because that is an additional service. There are some CPAs who package this in with the return prep price, but then you are really paying for audit representation insurance. Say a CPA prepared 100 returns and 2 were audited. If all 100 clients purchased the "audit representation package," the reality is that the two who were audited got a great deal, but the 98 who didn't got ripped off.

Again, all this is just my personal opinion on a free message board. Good luck in your decision.
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