How much do you pay your tax preparer - and referral?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We’re retired. We paid $1200 last year for a fairly simple return that includes two rental properties, income from our brokerage accounts, and the occasional withdrawal from retirement account. We use a Maryland based firm although we live in DC. They just notified us that they are raising our fee to an estimated $2200 and when I asked why they said they have been undercharging us. I’m surprised by the increase, but what can you do?

Wow $2200??? Your return hardly sounds complicated. There must be less expensive options that aren’t TurboTax/H&R Block.

Yeah, you would think. Probably after this year I am going to look around. I thought $1200 a year was reasonable but I don’t think double that is. The main issue is I’m just lazy and knowing that my accountant has probably a dozen years of my tax related stuff at their fingertips if I ever get audited or whatever keeps me tethered to them.

Statute of limitations is 3 years. A dozen years worth of stuff is irrelevant.

[Anonymous]

Anonymous wrote:$150-200 to TurboTax? We have 2 salaries, a standard mortgage, I have stock awards some years, we sell stock some years, we have a brokerage investment account and a handful of interest bearing accounts. We itemize for charitable contributions. It takes my husband 3-5 hours total.

Why is anyone paying $1000+ unless you own your own business? Even nanny / household employees can be handled by a service for a low monthly fee.

+1. It seems insane to me to pay more than a nominal amount for the privilege of paying taxes.

[Anonymous]

Anonymous wrote:

Anonymous wrote:$150-200 to TurboTax? We have 2 salaries, a standard mortgage, I have stock awards some years, we sell stock some years, we have a brokerage investment account and a handful of interest bearing accounts. We itemize for charitable contributions. It takes my husband 3-5 hours total.

Why is anyone paying $1000+ unless you own your own business? Even nanny / household employees can be handled by a service for a low monthly fee.

+1. It seems insane to me to pay more than a nominal amount for the privilege of paying taxes.

I think it's because a lot of people have an understandable fear of an audit- not about paying more taxes per se, but the stress/time. That is understandable, but the actual risk for 99.9% of people is incredibly small. Even if you make a substantial error, most of the time the IRS response is to send you a notice and a bill. That happened to us years ago- we forgot about some freelance work one of us did early in the year, and somehow didn't notice the 1099 when it came in. Never got reported on the return. Two years later we get a notice from the IRS saying "hey, you didn't report this income, you owe us ~$2k and some small penalties". Looked it up, they were of course right, filled out the form, sent the check, and everything was good. Apparently that is considered a "correspondence audit" and makes up 3/4 of all audits:

https://www.nolo.com/legal-encyclopedia/irs-tax-audits-triggers.html

I think most people are fearful of the much more in depth type, which as the article shows, is very unlikely. I'll bet most of that 0.1% for people in middle income ranges are basic mistakes like ours, and the vast majority of the rest are pretty complicated returns that raise a bunch of red flags. If your return isn't like that (and it sounds like almost none discussed here are), the risk is incredibly low.

[Anonymous]

If you are afraid of audit, you can get audit protection from Turbotax. I did that for the first time last year, and it was a pleasure to have their people dealing with the IRS rather than me. The hardest part is getting to someone knowledgeable on the phone in less than ten hours--enrolled agents who do audit protection have much faster access.

[Anonymous]

Anonymous wrote:If you are afraid of audit, you can get audit protection from Turbotax. I did that for the first time last year, and it was a pleasure to have their people dealing with the IRS rather than me. The hardest part is getting to someone knowledgeable on the phone in less than ten hours--enrolled agents who do audit protection have much faster access.

Did your audit involve something more complicated than the "correspondence audit" described above?

[Anonymous]

Nothing as my sister does it for free and has for years. I try not to complicate my taxes.
HofH, one w-2 and some investments.
Got them done at H and R blocks long ago and they took 10% not because they were complicated, but because I got a lot back.

[Anonymous]

I mean even in the extremely unlikely case (as a middle income taxpayer) that you get a real audit, what’s the worst that could happen? Genuine question. It seems that if you are a taxpayer of at least average competency who acted in good faith filing their return, the worst case is pay back some taxes plus interest and a relatively small penalty.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We pay $1700 for a married filing jointly return, for federal and VA. Forvis (used to be Dixon Hughes Goodman) on Spring Hill Road in Tysons.

$1700! Is it a complicated return or just a couple with salary income?

The latter. That's McLean for ya.

This is ridiculous. We pay around $3000, but that's for Federal, MD, 5-7 other states (depending on a variety of factors), and guidance throughout the year on estimated tax witholdings, review of tax memos, and PET issues.

[Anonymous]

Anonymous wrote:We’re retired. We paid $1200 last year for a fairly simple return that includes two rental properties, income from our brokerage accounts, and the occasional withdrawal from retirement account. We use a Maryland based firm although we live in DC. They just notified us that they are raising our fee to an estimated $2200 and when I asked why they said they have been undercharging us. I’m surprised by the increase, but what can you do?

DO them yourself? Good grief.

[Anonymous]

Anonymous wrote:Our preparer has increased their rates for the second year in a row and I would be interested in knowing what is the going rate in the DMV and if you would refer your tax preparer.

A Warning to never use H&R Block for tax services.

I was working there as second job and lasted only a few days. Corporate says they are supposed to assign clients based on expertise but in the office I was at, everything was thrown at the new folks. I was assigned level 4 Tax returns when I had not completed the training and I was not competent.

In reality they work with uninformed taxpayers that rely on their expertise. but how can they tell good from bad? many of them are just guessing.

I could not continue completing tax returns that I was not competent on, rental properties, schedule C businesses etc.

and they pay 20$ an hour to complete tax returns that have tens of thousands of dollars in the balance.

[Anonymous]

I sleep with him but he’s not taking clients

[Anonymous]

Anonymous wrote:

Anonymous wrote:If you are afraid of audit, you can get audit protection from Turbotax. I did that for the first time last year, and it was a pleasure to have their people dealing with the IRS rather than me. The hardest part is getting to someone knowledgeable on the phone in less than ten hours--enrolled agents who do audit protection have much faster access.

Did your audit involve something more complicated than the "correspondence audit" described above?

I have had correspondence audits in the past. No big deal--pay the bill. But in this case it was a much larger amount, $20,000, an amount we had paid that the IRS said we had not. We had had the same problem earlier for tax year 2019 that took me ten hours on the phone, plus faxing in additional evidence, for the IRS to concede we had in fact paid the amounts.

Those ten hours resolved it, but didn't get to the root cause. It turns out that DH was using the wrong form for filing estimated taxes, something he has been doing for over ten years. The TT audit defense people spotted immediately what the source of the problem was, we sent in evidence of payment to them, and they handled all the IRS end of things. DH is now filing with the right form, so I hope that is the end of that.

So, yes, a correspondence audit, but one that would have taken me scores of hours with the IRS to resolve. From that perspective, paying for audit defense was worth every penny.

[Anonymous]

Anonymous wrote:We paid $3700. We have no wage income but a business, lots of investment income/capital gains, K-1s and a couple of kids that owe kiddie taxes. Still, it seems high after reading through the other responses.

We are similar to you but also need to pay states taxes (about 15 ish) and foreign taxes. Our accountant charges close to $5K.

[Anonymous]

$950. I consider our taxes medium-complicated (2 W-2s, 1 K-1, an LLC for a rental property, and all the assorted investment accounts) and the fee seems worth it to me. I do miss being able to deduct last year's tax prep, though.

[Anonymous]

Bump for 2025.