My professional practice is based on the principle of providing high value low cost services to working class clients. Most all of my clients have household incomes under $1 million and consider themselves “working class”. As a result, most of my fees tend to fall range of 1% to 2% of a client’s gross annual income. This is generally considered to be at the low level of the fees for independent CPA firms. My fee schedule and engagement agreement are available online at https://SouthJersey.CPA.
Normally we agree to a fee for service in advance in writing. That is the ideal, logical, and sound way to do business.
But this current tax season makes it almost impossible to follow that sound business policy. I am often unable to forecast the amount of work it will take to file a tax return, or alternately, my estimate is far off the mark. A substantial number of returns are rejected and even more receive automated adjustments. Additionally, the large increase in new client requests makes it difficult to find the time to even attempt to do estimates.
As a result – for this tax season only – when a pre-agreed fee is not in place, my accounting system will simply bill all services at the minimum annual client fee of $1,200 even if that amount is too much for the tax service provided. This is based on the amount that I pay to support each client (total overhead cost divided by total number of clients) but it higher than prevailing market price for many tax return preparation services.
In this case, you may pay any amount on the invoice and it will be marked “paid in full”. The risk of this system is entirely on me.
After tax season I will return to address these situations. We may:
- agree to add other financial coaching, support and advisory services so that the value to you is more than the $1,200.
- agree to find another provider who can offer only tax preparation service for less than $1,200.
- decline to provide additional service after the conclusion of this tax filing engagement.
But again, this risk is entirely on me.