How much should you pay your tax preparer?
Mar 16th 2010 2:00PM
Updated Mar 17th 2010 3:27PM
These fee averages supplied by the National Society of Accountants can serve as a guideline for hiring the person you're going to have to pay once Uncle Sam finishes with you.
Just remember, Society spokeswoman Julene Joy told WalletPop this week: Rates are affected by location and the intricacy of the return. "Customers should request an estimate if one wasn't provided during their meeting," she said, adding that negotiating is OK with some preparers.
The nationwide average for an itemized 1040 with Schedule A and a state return is $229, according to the Society's 2009-10 survey of 8,000 tax preparers. The average for the non-itemized 1040 with Schedule A and state is $129.
The mean cost for an itemized return rises to $292 in the territory covered by Alaska, California, Hawaii, Oregon and Washington. New York, New Jersey and Pennsylvania follow at $243. The cheapest region consists of Alabama, Kentucky, Mississippi and Tennessee, at $137.
You might save if you choose an independent preparer. An itemized 1040/Schedule A/state averaged $217 from self-employed preparers and $245 from a company with three or more on staff. Other service averages range from $58 for a 940 Federal unemployment form to $692 for an 1120 corporate filing, to $2,044 for estates.
About 10% of accounting firms demand a percentage of the payment upfront. Most bean-counting houses, about 60%, ask for no sum until the returns have been completed to the clients' satisfaction.
While it is important to pay attention to fee structure, the Society urges consumers to be wary of preparers who play fast and loose with the numbers -- even before seeing any paperwork.
"When a tax preparer gives a consumer a guaranteed tax return, prior to preparing their taxes, this should be viewed as a red flag," Joy told WalletPop. "Additionally, someone who guarantees that the return they prepare will be larger than that of another preparer should be considered suspicious."