by Tony Novak, CPA, MBA, MT revised October 10, 2015
(These are not my fees. For information about my fees for 2015 tax returns see this January 3, 2016 blog post).
The average income tax preparation fee this year for 2014 tax returns prepared in the mid-Atlantic region was $314 this year; an increase of about 4% over last year. That average rate published by the National Association of Accountants is calculated as a benchmark for a typical Form 1040 tax return with a Schedule A for itemized deductions and on state income tax return. The survey includes both professional fees and non-professional preparers. Average fees for other tax schedules are listed below.
These rates are the average of all types of income tax preparers including CPAs and other non-professional preparers. In general, CPA rates would likely be higher than this average and non-professional preparers would be less.
The nation’s largest national tax preparation firm is priced higher than smaller firms however the fees are boosted by selling supplemental services like refund advances. These statistics are calculated by the National Association of Accountants (NSA) that compiles the largest database of tax return preparation data in the country. The NSA notes that the amount of time required to prepare a tax return is rising faster in recent years than the fees charged.
Specifically time-consuming are tax returns with an Earned Income Credit, Home Office Deduction or individuals who purchase their own health insurance. This means that tax preparation services represent a growing value for consumers.
Average fees for other tax forms:
$174 for a Form 1040 Schedule C (business)
$634 for a Form 1065 (partnership)
$817 for a Form 1120 (corporation)
$778 for a Form 1120S (S corporation)
$457 for a Form 1041 (fiduciary)
$688 for a Form 990 (tax exempt)
$68 for a Form 940 (Federal unemployment)
$115 for Schedule D (gains and losses)
$126 for Schedule E (rental)
$158 for Schedule F (farm)
This past tax season (2014) my pricing strategy was to set base level fees at 10% to 15% lower than the average fee that includes both CPAs and non-professional preparers. But this base level pricing presumed remote electronic services and did not include the cost of personal meetings, travel, paper document handling and presentation of a paper copy of the tax return.
Next year (2015) I expect to set prices at 10% to 15% higher than the regional average because of client feedback about providing a higher level of personal service and attention. In other words, it turns out that the majority of clients in my natural affluent niche market would prefer to pay a bit more for premium services.
See "Fees for
CPA-prepared tax returns" for more information.
Opinions expressed are the solely those of the author and do not represent the position of any other person, company or entity mentioned in the article. Information is from sources believed to be reliable but cannot be guaranteed. Any accounting, business or tax advice contained in this communication, including attachments and enclosures, is not intended as a thorough, in-depth analysis of specific issues or a substitute for a formal opinion, nor is it sufficient to avoid tax-related penalties. Tony Novak operates as an independent adviser under the trademarks "Freedom Benefits", "OnlineAdviser" and "OnlineNavigator" but is not a representative, agent, broker, producer or navigator for any securities broker dealer firm, federal or state health insurance marketplace or qualified health plan carrier. He has no financial position in any stocks mentioned. Novak does work as an accountant, agent, adviser, writer, consultant, marketer, reviewer, endorser, producer, lead generator or referrer to other companies including the companies listed in the articles on this web site.