Tax Return Cost

Discussion in 'Business Operations' started by iforgotmybackpack, Jan 21, 2013.

  1. iforgotmybackpack

    iforgotmybackpack LawnSite Member
    Messages: 41

    My company is a multi-member LLC. For the owners that don't do their own returns, I was curious as to how much my fellow Lawnsite members were paying to get their yearly tax returns prepared and filed for them. I got a quote for $450-$600 to have my CPA do mine. Is that in the average ballpark? Seems a bit outrageous for entering numbers into a computer program. :dizzy:
  2. jc1

    jc1 LawnSite Silver Member
    Messages: 2,162

    That's probably on the low side. We pay a little more than that. Having an accountant is worth every penny if you even get an IRS audit. It's slightly more than entering numbers, it's knowing and understanding tax laws.
  3. xclusive

    xclusive LawnSite Bronze Member
    Messages: 1,054

    That is cheap so consider yourself lucky if thats what your paying. Its a lot more for than entering numbers into a computer program. Its just like if you offer to cut a lawn weekly for $40 and another guy comes in at $25 you know 9 out of 10 tens the cheaper guy is not performing the same level of service(s) you would be. At the end of the day you get what you pay for.
  4. iforgotmybackpack

    iforgotmybackpack LawnSite Member
    Messages: 41

    Well that's good to hear that the cost isn't above the norm. I understand there is much more than entering numbers, I was just a little frustrated. Hopefully we get some snow! Stinks that tax time always comes at the end of a long winter with limited income. Thanks for the input guys. Its appreciated
  5. Kelly's Landscaping

    Kelly's Landscaping LawnSite Platinum Member
    Messages: 4,725

    1000 dollars a year the last 9 years to do the returns. 600 goes to the business returns and 200 goes to each partners returns. I suppose you could try to do it yourself but if I was to be audited I would like a CPA representing me.

    I understand your first gut reaction was to belittle what the CPA does and go really for just a few numbers being entered. But our trade of all trades ought to be better than that. I still see red when I think back to an A-hole Doctor bitching about his fall clean up bill and his quote $700 dollars for just a few leaves. How do you respond to that when you just spent nearly 7 hellish hours there with 4 men (so 28 man hours) and gave him a price way lower than you should of already.
  6. iforgotmybackpack

    iforgotmybackpack LawnSite Member
    Messages: 41

    I agree with your point completely. Thanks for the input.
  7. DLCS

    DLCS LawnSite Platinum Member
    Messages: 4,386

    Most of us understand your frustration there.
  8. britsteroni

    britsteroni LawnSite Senior Member
    Messages: 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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