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How much should tax preparation cost

how much should tax preparation cost

NSA Finds Average Cost of Tax Returns

March 9, 2006 (SmartPros) How much should it cost for a professional accountant to do taxes? The National Society of Accountants (NSA) found the answer. It surveyed 1,371 accountants nationwide to find out the mean cost of preparing a variety of tax returns.

For example, NSA found the mean cost of preparing a non-itemized Form 1040 to be $110 For an itemized Form 1040 with Schedule A, the cost is $201.

Where one lives can make a difference in the fee paid. For example, accountants in the Midwest charge a mean of $96 (non-itemized Form 1040) and $163 (itemized Form 1040), while those in the Northeast, South, and West charge between $111- $116 for a non-itemized return and between $205- $226 for an itemized return.

The mean cost for preparing other types of tax returns includes:

  • $165 for a Form 1040 Schedule E (Rental)
  • $207 for a Form 1040 Schedule F (Farm)
  • $477 for

    a Form 1065 (Partnership)

  • $640 for a Form 1120 (Corporation)
  • $624 for a Form 1120S (S Corporation)
  • $386 for Form 1041 (Fiduciary)
  • $1,732 for Form 706 (Estates)
  • $449 for Form 990 (Tax Exempt)

The survey also found that taxpayers are increasingly choosing to file returns electronically, a service that most accountants offer. More than 70 percent of all returns that can be filed electronically are submitted that way -- up more than 20 percent over the last three years. The average fee for this service is $23.

Hourly fees for accountants to provide tax services average $109, while hourly fees for estate and financial planning average $123.

Like most other services, tax preparation fees are increasing. NSA reports that accountants raised their tax preparation fees 6.5 percent in 2005, and expect fees to rise 6.8 percent in 2006.

NSA and its affiliates represent 30,000 members.

Revised: March 12, 2006

2006 SmartPros Ltd. All rights reserved.

Category: Taxes

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