Preparation Fees

I need some insight on tax preparation fees. I am just starting my tax business and I need some help with the fee structure for the individual forms, schedules, and worksheets.

Hi Everyone,

I will be starting my Tax Preparation business this upcoming tax season. But I am not sure what software is best for this? I would like to offer Rapid refunds, and E-file but who do I call and or where do I go? I am trying to do as much research as possible but I am not getting anywhere... Can anyone point me in the right direction???? It is greatly appreciated!!! Since I have tried and gotten no where...

Thanks again..

A Latina with a dream in Ontario, California said: Hi Everyone,

I will be starting my Tax Preparation business this upcoming tax season. But I am not sure what software is best for this? I would like to offer Rapid refunds, and E-file but who do I call and or where do I go? I am trying to do as much research as possible but I am not getting anywhere... Can anyone point me in the right direction???? It is greatly appreciated!!! Since I have tried and gotten no where...

Thanks again..

You will need to contact the IRS and apply for an EFIN if you plan on E-filing, this can take up to 45 days and also you would want to apply for a PTIN so that you don't have to use your SS# on tax returns you prepare. You can start out by calling the IRS or go to irs.gov and click on the Tax Professional tab, scroll down to e-services and register. There are a number of steps, but it will walk you through.

If I could be any help it is o.k. to email me at stacycservices@yahoo.com

Stacy

Hello Everyone,

Does anyone have any advice on software? Or have used software and can give me som recommendations?

Thanks!

Anaya Smith in Rancho Cucamonga, California said: I need some insight on tax preparation fees. I am just starting my tax business and I need some help with the fee structure for the individual forms, schedules, and worksheets.

I use Intuit-Pro Series. It is very user friendly. The website is www.proseries.com
Paula

A Latina with a dream in Ontario, California said: Hi Everyone,

I will be starting my Tax Preparation business this upcoming tax season. But I am not sure what software is best for this? I would like to offer Rapid refunds, and E-file but who do I call and or where do I go? I am trying to do as much research as possible but I am not getting anywhere... Can anyone point me in the right direction???? It is greatly appreciated!!! Since I have tried and gotten no where...

Thanks again..

I would like to know if you have had any success in getting approved by the RAL banks.

Stephen E. Smith, EA

My company www.peoplestax.com operates multiple tax preparationoffices in central-Virginia and we use TaxWise. They can help,you select a RAL bank (we use SBBT). Our account executive, Lisa Berrian, can be reached at Lisa.Berrian@cchsfs.com. You can also find some articles on the resources section of our tax school website that might be of interest: www.theincometaxschool.com. You can reach me at cmccabe@peoplestax.com.

I am also just starting my tax business and need guidance on a fee schedule. Please send to info@instant-taxrefunds.com

Has anyone used Taxcut???? I am getting desperate because I still do not have software yet.....any recommendations at such a last minute decision? I want good dependable software at a reasonable cost....

Thank you Chuck and Charles you both hsve been a great help by giving me some direction. Again, Thank you!

Monique

A Latina with a dream in Ontario, California said: Thank you Chuck and Charles you both hsve been a great help by giving me some direction. Again, Thank you!

Monique

Hi Monique,

I personally checked out both TaxWise and ProSeries... and found that for my purpses - Proseries was the best option and value for my $ (being this my first year in business).

~Maria

Monique,

Be sure to check out both Tax Wise and Pro Series yourself to determine which would be best for you. You might also consider Drake.

Chuck

A Latina with a dream in Ontario, California said: Has anyone used Taxcut???? I am getting desperate because I still do not have software yet.....any recommendations at such a last minute decision? I want good dependable software at a reasonable cost....

hello, you can download the softare from proseries basic, i think they charge $300 it is super easy to use, and i started using that my first year and i loved it. i am in fontana ca and if you need help i can show you a few things, i started my business off very small, i use to work for jackson and hewitt in 2004 and in 2005 i wanted to start on my own becuase so many people asked me if i can do there taxes, i started off with friends and family and ended the year with 50 customers and now i have 200 clients, i am a mobile tax preparer so i go to my clients home, i am update to date with efiling, offer bank products, and i also accept credit cards. i wish you the best this tax season. My email is: priscillaudave@gmail.com feel free to call me with any questions you might have.

TaxCut is designed for taxpayers not tax professionals. You should use a professional tax preparation software package. You will need the functionality, support and interface with banks if you provide fast refund services.

hello i was wanting some suggestions/comments on the fees that i i charge i just want to see what other tax prepares think of my prices, i want to see if my fees are ridiculously cheap, or fair. I am a mobile tax preparer, i prepare and efile the tax return in the convenience of my clients homes. i use to charge as low as $50 but i know that is way to cheap. i am thinking about starting my minimum fee at $65 for 1040, state and efile and then charge $80 for 1040, EIC/state and efile. what do you guys think?? please any comments are welcome and helpful. thank you..do you guys think these fees are way to cheap????

Anaya Smith in Rancho Cucamonga, California said: I need some insight on tax preparation fees. I am just starting my tax business and I need some help with the fee structure for the individual forms, schedules, and worksheets.

JM Accounting & Tax Preparation, great service, VERY LOW cost, jmaccounting.weebly.com - highly recommended, they have a price list here.

Dena in Tallahassee, Florida said: Can you provide me with a fee schedule? I want to start my own business and I am not sure what to charge. My email address is dens_cyc@yahoo.com.

JM Accounting & Tax Preparation, great service, VERY LOW cost, jmaccounting.weebly.com - There is their price list.

priscilla udave in fontana, California said: hello i was wanting some suggestions/comments on the fees that i i charge i just want to see what other tax prepares think of my prices, i want to see if my fees are ridiculously cheap, or fair. I am a mobile tax preparer, i prepare and efile the tax return in the convenience of my clients homes. i use to charge as low as $50 but i know that is way to cheap. i am thinking about starting my minimum fee at $65 for 1040, state and efile and then charge $80 for 1040, EIC/state and efile. what do you guys think?? please any comments are welcome and helpful. thank you..do you guys think these fees are way to cheap????

Here is how much I was charging, jmaccounting.weebly.com/index.html ... yes, for e-file and house calls it seems a bit low, I was charging much lower but will boost it up about $20 dollars on average. It is only to win over some customers.

It was great to see a fee schedule that appeared reasonable compared to what I want to charge in my new tax business. I worked at Liberty Tax last year and was blown away by what they charge to do simple returns. I also really like your website.

Thank you very much, I love the compliments. :D
By the way, just be careful not to undervalue your work; for 2008 I was charging $30 for everything (all 1040's, multi-state, all schedules, all forms, and free info). Keep in mind, a low price is great for attracting many new clients, but not much profit may come of it.
I hope everything goes great for you this coming tax season, only two months left!

jmaccounting.weebly.com
jmaccountingandtaxpreparation@gmail.com
11/05/09 - 7:33pm

I started working from a home office and charged way too little for a few years. Now I just try to stay under H&R Block's pricing, since they are my main competition. With the office and overhead I can't really charge the ridiculously low prices I used to charge, but my clients have not complained because they get good service and I still charge less than most of the competition. I expect my average fee for 2009 returns to be around $115 for federal returns, we have no state returns here. If they require a part year or non resident state return I charge $25 more. Of course I do offer returning clients a discount for coming in early, and I do mass mailings of postcards offering discounts for new clients, so my real average price will be lower.

And by the way, the $115 average fee does not include RALs.

That is a good price, I just need a few more customers and I will be charging a bit higher.
For this tax season, I think I will be switching to a home office to cut costs. H&R Block is my greatest competition too, that is the main reason for my low low rates. I have to steal some customers! :D

I will be doing some extensive marketing next tax season- trying to really grow the 1040 clients. The home office can help or hinder you. In my case, the area I live in has tons of rules about what you can and cannot do, so I wasn't really allowed to have clients coming in and out of my house. I did sometimes, but rarely. I usually had to meet them somewhere else or get them to mail everything in.

The mobile thing can get expensive because they often don't want to pay much for you to come to their house and do it. Plus I feel like I could never possibly carry everything I need/want with me. I now rented an office and I'm hoping to gain enough clients to justify it. I got a good deal on the rent and have a very short term lease for now.

By the way, in case you don't already know about it- check out www.taxalmanac.com. It's a great forum for tax professionals.

I appreciate the feedback on pricing. I live in the middle of small town Iowa although we do have H & R Block at Walmart! My mission is to offer the same services and guarantee that they do at but at much less. I'm hoping to average $65 for a simple 1040 to $100 for a 1040 with a few schedules. I'm still trying to work out my pricing. I appreciate the comments on not charging enough.

pbergmann in Delhi, Iowa said: I appreciate the feedback on pricing. I live in the middle of small town Iowa although we do have H & R Block at Walmart! My mission is to offer the same services and guarantee that they do at but at much less. I'm hoping to average $65 for a simple 1040 to $100 for a 1040 with a few schedules. I'm still trying to work out my pricing. I appreciate the comments on not charging enough.

H&R Block charges by the form. I recommend you do a simple fee across the board. That way there are no complications. But rememeber SERVICE sells as opposed to price.

i'm using drake tax software...so far so good. drake support let me download a past version for free and i went ahead and ordered for upcoming tax season. so if any one wants to try drake its free. you guys fees seem a little low imo. i live in the atlanta area and i've had people tell me they would pay $300 for taxes. i've had people say h&r block charges $500. i'm a mobile tax preparer and i'm looking at a fee of $175-$200 per client. that includes e-file federal and state. since i would be riding around the city i'm really sticking to my price. it takes time and energy to ride around and if i'm riding an 2 hours round trip i need to make up for that in the price.

H&R Block's average fee last year was around $185, so $500 is not the norm. In Florida we do not have state or city income tax so that lowers the fees a bit. If you are providing a mobile service, you do need to charge more to make up for that, but it can be difficult because many people do not want to pay more for that. Especially is they can go down the street to the local tax chop shop for the same price or lower. And remember, while $175 might be reasonable for a 1040, it is not for a 1040EZ. Drake is great software, especially if you do more than just 1040s.

Anaya Smith in Rancho Cucamonga, California said: I need some insight on tax preparation fees. I am just starting my tax business and I need some help with the fee structure for the individual forms, schedules, and worksheets.

it varies from 100 to 500 depends on w2's, filing status, schedules, is hard to estimate till you calculated first and go from there, how long it takes you to processes it. ok?
Laura Baez

Is everyone in here a CPA? So, I'm just starting out and was wondering what the best marketing tools are for getting clients. I know my pricing is very competitive, I'm a CPA and am great with customer service. However, I have to find out what marketing works.. does anyone have any thoughts?????

Your ideas are very much appreciated!!
Mark in Maryland

I am sitting for the CPA exam now but I have a BS and MBA in accounting and am an Enrolled Agent. I have my own practice. What worked for me so far- Craigs List, Google (both free listings such as Local Business Center and paid like Adwords), great website, referrals, direct mail. Print ads in a local paper did not work. Next year I will also do ads in the newsletters for individual communities since most home owners will read them, handing out coupons/flyers in nearby shopping centers, and hiring soemone to stand by the road with a big sign in front of my office.

Hi "Pro Tax Preparer".. thanks so much for the thoughts.. I'm going to try all of your ideas and am also doing flyers for neighborhoods, cars at the mall and on cars at the metro stations (subway) here in D.C... My wife is a graphic designer who worked for a design studio for 7 years. so luckily I have an abundance of talent ready to help me.

So, roughly how many returns did you prepare last year? (so I can get an idea of how many returns a successful tax preparer performed).

Good luck with the CPA exam, I didn't find it to be that difficult.. it just took study time.. I'm in the middle of a Masters Program for Taxation and find that more challenging than the CPA exam..

I prepared 280 returns that were 1040s, 3 1041s, 7 1065s, 2 1120, and 43 1120S returns. I think I'll be okay with the CPA exam, I have the Becker course. And taking the Enrolled Agent test I think helped. This was my third year on my own, and my first year in the office space (before I worked out of my house). I still have a lot more to grow. I have 31 accounting clients as well.

so what is the best school to go to to learn more about taxation?

your donig pretty well pro tax..

A Latina with a dream in Ontario, California said: Hi Everyone,

I will be starting my Tax Preparation business this upcoming tax season. But I am not sure what software is best for this? I would like to offer Rapid refunds, and E-file but who do I call and or where do I go? I am trying to do as much research as possible but I am not getting anywhere... Can anyone point me in the right direction???? It is greatly appreciated!!! Since I have tried and gotten no where...

Thanks again..

TRY DRAKE PROGRAM THEY WILL GUIDE YOU

TaxACT is inexpensive and offers e-file and bank products. I'm starting a tax business this year also and am going with this. Also will be doing lots of marketing.

I'm new to Drake and new to the ability to use their Document Management software........by scanning customer tax documents. I think I need to buy a document scanner but a $500 fujitsu isn't in the start-up budget.

1. Does it really work to scan the info in rather than type?
2. what kind of scanner do you use?
3. give me an example of work flow (in prior years I had customers fill out/sign a profile from which I did data entry, photocopied all supporting documentation, kept all but 1 w-2 for my files)

Seems to me that even at 15 ppm scanning 3 w-2s 5 ss cards, 2 DLsand 5 1099s will take a long time. Then add in a couple of AGEdwards stock sales and from the non=experience end it seems like the system was developed by someone who could neither type fast nor accurately.

Suggestions, please!

Rosa- yes, going paperless is much better. Workflow is similar, but you scan everything instead of making copies.

Taxgirl- it depends on the type of preparers you need and the type of returns you are going to prepare. If you are looking to compete with the major tax chop shops and are going after that low income EIC/RAL crowd, you can pay $2-3 per hour above minimum wage for your state with maybe some kind of bonus/commission structure. If you think your returns will be more complex and/or you want to hire someone that can also help with the bookkeeping, you need to pay $7-10 per hour above minimum wage. Craig's List is free and works for some people, then there's Monster.com and places like that.

Thank you so much for your input. Do you think it is possible to hire independent contractors on a 1099, commission base only, instead of employees? I've heard some people just outsource the work overflow all together. What are your thoughts about that?

You can hire them on a 1099 basis but make sure you are treating them like independent contractors then. This means you are not constantly telling them what to do and how to do it, you just tell them to do the returns and review the end result. The only times I have seen accountants hire 1099 workers during tax season is when they hire very experienced preparers that do everything on their own. Avoid commission as much as you can- it gives them an incentive to produce more forms or take longer than necessary. A flat rate per return is usually better.

Outsourcing is dangerous. First you need to make sure your clients provide you written consent to do this, which generally they do not want to do. Then you need to really trust the person you are outsourcing to. And overall I think you can be more profitable without outsourcing.

hiring contractors is great but you really have to trust them. are they doing finger prints for background check?

Do you mean for the EFIN application? Yes.

ok well as long as you got the contractor info you should be ok.

I'm moving forward with the new tax preparation business and lots of questions came up while doing all kinds of research for the procedures and services:
1. What is the best (inclusive & inexpensive) software for a first-year office?
2. Is there a way to offer rapid refund products without contracting directly with a bank, for example through a third party?
3. How profitable could be adding bookkeeping services in year 2?
Thank you all for your input!

I don't know why it says I'm in South Carolina...lol.

Anyway, if you are only going to do individual returns, which I recommend for a first year office, take a look at Proseries. It's $649 for the basic version for unlimited returns and has the best ratings for ease of use and learning it quickly. Plus, if you do a few business returns you can do them on a PPR basis. Call ASAP for a demo. The Professional version is $1299 but it's also great software. I used Basic for a few years and it was fine.

Bookkeping is not as profitable as tax work but it does help bring money in the door after tax season. If you don't have an accounting background or education though I suggest you go take some courses first. Good luck.

Pro Tax Preparer in Anderson, South Carolina said: I don't know why it says I'm in South Carolina...lol.

Anyway, if you are only going to do individual returns, which I recommend for a first year office, take a look at Proseries. It's $649 for the basic version for unlimited returns and has the best ratings for ease of use and learning it quickly. Plus, if you do a few business returns you can do them on a PPR basis. Call ASAP for a demo. The Professional version is $1299 but it's also great software. I used Basic for a few years and it was fine.

Bookkeping is not as profitable as tax work but it does help bring money in the door after tax season. If you don't have an accounting background or education though I suggest you go take some courses first. Good luck.

Do you mean Proseries from Intuit?

I have a degree in Int'l Business, but my accounting background is very limited & rusty. I definitely want to have this business generating something the rest of the year - perhaps by partnering with an experience bookkeeper while I get the training myself.
But before I do any of this, I want to get an idea of the potential of revenues for the 1st year and what those depend on. Any more info you have for me is greatly appreciated!

Lol now my phone thinks I am in GA.

Yes Proseries from Intuit- great price, easy to use. I have never placed a phone call to tech support because it's so easy to learn how to use. If you will have multiple preparers though it will be much easier if you get the network license which is only available on the professional version.

If your degree is in international business do yourself a favor and get some CPE on individual taxation fast. There are plenty of online refresher courses available. Tax preparation is not as easy as many people think.

Bookkeeping revenue depends on many factors. I have many monthly clients. My minimum is $100 per month and I do payroll tax returns and W2s for free for monthly clients. My highest one is $300 a month but I do work for them every week. The problem is there's always some idiot that will do bookkeeping for $10 an hour so you can only charge so much for it. You can also do payroll, QuickBooks setup and support, tax planning, etc.

Getting clients takes time and money though- they will not just come to you. I hope you have a good marketing plan and budget in place. I expect to spend about 5,000 on marketing for both individual and business clients in 2010.

Pro Tax Preparer in Norcross, Georgia said: Lol now my phone thinks I am in GA.

Yes Proseries from Intuit- great price, easy to use. I have never placed a phone call to tech support because it's so easy to learn how to use. If you will have multiple preparers though it will be much easier if you get the network license which is only available on the professional version.

If your degree is in international business do yourself a favor and get some CPE on individual taxation fast. There are plenty of online refresher courses available. Tax preparation is not as easy as many people think.

Bookkeeping revenue depends on many factors. I have many monthly clients. My minimum is $100 per month and I do payroll tax returns and W2s for free for monthly clients. My highest one is $300 a month but I do work for them every week. The problem is there's always some idiot that will do bookkeeping for $10 an hour so you can only charge so much for it. You can also do payroll, QuickBooks setup and support, tax planning, etc.

Getting clients takes time and money though- they will not just come to you. I hope you have a good marketing plan and budget in place. I expect to spend about 5,000 on marketing for both individual and business clients in 2010.

Thank you so much for sharing.
I worked for block for about 4 yrs while I was in college, and then had a small office for a couple of years. However, it's been like 10 years that I don't prepare taxes for a living - only my own and my friend's. I had to retake the tax courses, and I agree with you on the CPE refreshers.
Do you think with good marketing in place, getting about 5 bookkeeping clients a month is doable for a new business?

It depends on how big of a city you live in but I think that's too much. That would be 60 per year. I do direct mail and cold calling and can't get that many. Someone on another forum said they did cold calling, direct mail, and walked in to local businesses very aggresively and one year later they had 32 business clients.

Think about it. New businesses often don't think they need a professional accountant. They think they can do it themselves with QuickBooks. On those you might get revenue for QuickBooks set up and cleaning up their mess every once in a while. Existing businesses won't switch unless they are unhappy with their current accountant. Even if you offer to do it for less.