The CPA fees for corporate tax returns are important to know when determining a budget for your business accounting. One of the difficulties in determining the CPA fees is that tax professionals have varying ways for how they set prices to prepare returns. This can make it difficult to compare rates between to companies. In general, the costs of having your corporate return prepared will increase with the complexity of your situation.

When comparing rates between tax professionals, you can ask up front which way they use to determine their prices and ask them to provide an estimate of the services you may require. To give you a more accurate estimate, accountants will typically need to meet with you and discuss your financial situation. It is important to remember that not all of these consultations are free.

Methods Used for Setting Prices

While there are many types of methods that accountant and tax professionals may use to set their prices, some of the most common methods include the following:

  • A fee for each form or schedule that needs to be filed.
  • A fee that they base on the previous year's fee plus any additional charges for current tax matters.
  • A minimum fee for the return plus additional fees based on the financial situation.
  • A subjective value of the tax preparation service.
  • An hourly rate for how long it takes to complete the form.
  • A fee for every item that is entered.

While most firms will not be able to give you an exact price, they should be able to give you some price ranges based on your tax situation. You may also want to note that some firms will charge higher prices if the forms need to be filed during busy seasons.

While pricing models vary from firm to firm, there are some types of pricing models that are actually forbidden by the Treasury Department. Some examples of prohibitive charging include the following:

  • Charging a fee based on information they found in your return.
  • Charging a fee that is a percentage of your tax refund.
  • Charging contingent fees, except in very specific situations.

It is important to be wary of high fees, as these could indicate possible fraudulent activity. There have been multiple fraudulent cases where a tax preparer has taken inappropriate credits and deductions and then charged large fees to their clients. If the amount seems to be much higher than you expected, be sure to ask for a breakdown of the fees and how they were charged.

In the event you have a fee dispute with your tax preparer, the Treasury Department will provide regulations for your protection. You will be entitled to have all of your original tax documentation back even if you do not pay the fee, though the accountant may withhold any forms or schedules that they have used their time to prepare.

Average Tax Preparation Fees

On average, you can expect to pay around $273 for your tax return if you wish to itemize your deductions. This includes both state and federal form preparation. If you do not wish to itemize your return, the average will drop to around $176. You may also find that you pay more if you are missing important documents or do not have your receipts or other information properly organized. Having to search for this information takes the CPA additional time.

For less complicated tax situations, you can purchase tax filing software and prepare it yourself instead. These programs are inexpensive and will ask you a series of questions to make sure that everything in the return is covered.

Find Out What's Included in the Tax Preparation Fee

Once you have been informed of the required fees, make sure to ask what you will have included in the fee. You will want to know if it covers the following:

  • Electronic filing.
  • Phone calls.
  • Office visits.
  • Tax audit protection.

Averages Hourly Rates for CPA Services

While hourly rates vary greatly depending on the size of the firm and complexity of the tax situation, you can expect to spend the below average hourly rates for the following basic tax preparations.

  • Estate and Financial Planning: $163.
  • Auditing Financial Statements: $157.
  • Financial Services: $144.
  • Tax Services: $145.
  • Management and Advisory Services: $146.
  • Financial Statement Presentation: $134.
  • Quickbooks Services: $97.

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