The tax filing season is set to start next week when the IRS will begin accepting tax returns. Tax filers can buy do-it-yourself (DIY) software or hire a tax professional to file their return. Those interested in hiring a tax professional, may be interested to know how much it costs. An annual survey conducted by the National Society of Accountants (NSA) provides some guidance as to what you can expect in fees.
How much does it cost to hire a tax pro to file a 2014 tax return?
According to the National Society of Accountants (NSA), it costs $273 to hire a tax professional to prepare an itemized individual tax return, which includes a state tax return. The tax prep fee increased 4.6% as compared to the $261 average a year ago, but a lower growth rate than the 6.1% year over year increase last year. If the taxpayer is just claiming the standard deduction, the average cost is $159 versus $152 a year ago or an increase of 4.6%. You may be asking yourself how $273 is affordable when you compare that to online tax software program which range from $10 to $72 to file a federal and state tax return. While it is less expensive than the average price to hire a tax professional, there are other factors to consider. First, the tax professional will undoubtedly be able to provide advice and consultations that simply aren’t available with a tax software program. Second, the tax filer does not have to spend time completing online tax forms. Third, the tax filer will have peace of mind that a CPA or Enrolled Agent is partly accountable for their return. Fourth, the $273 fee for an itemized federal return and state return or $159 for a simple return, are only averages. There are many tax preparers that offer services below these rates. Many of the accountants in our network can attest to that as you can submit a request here to file your taxes online and receive quotes from multiple tax professionals.
What are the fees for business tax returns and other services?
The survey indicated a wide range of average prices for different type of services. For instance, the average fee to prepare a business return such as a form 1065 or 1120 can cost $634 and $817 on average versus $590 and $806 a year ago or up 7.5% and 1% respectively. Most accountants offer these services with a one hour free consultation with an average value of $100.
If you’re wondering how the pricing in your area compares to the rest of the country, the survey provided details. Those in the Pacific states (AK, CA, HI, OR, WA) can expect the highest fees at $348 vs. $303 a year ago, followed by the Mid-Atlantic states (NY, NJ, PA) at $314 vs. $274 a year ago, followed by the South Atlantic (DE, DC, FL, GA, MD, NC, SC, VA, WV) at $268 vs. $270 a year ago and then the East South Central states (AL, KY, MS, TN) at $262 vs. $294 a year ago. The New England states (CT, ME, MA, NH, RI, VT) were at $246, the West South Central (AR, LA, OK, TX) states were at $205, East North Central states (IL, IN, MI, OH, WI) were at $240, the West North Central states (IA, KS, MN, MO, NE, ND, SD) were at $198, and the Mountain (AZ, CO, ID, MT, NV, NM, UT, WY) states were at $256.
More tax questions? Browse answers or ask 2014 tax questions online. You can also find accountants online here.
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