Cost Of Professional Tax Filers-Is It Worth The Deduction

Cost Of Professional Tax Filers-Is It Worth The Deduction


Each year, come April 15th, millions of hard working, red-blooded Americans file federal and state income taxes to compute the amount of money they either owe the government or the amount they will refunded. Because the laws change every year and the U.S. tax code is difficult to understand many taxpayers hire the services of Certified Public Accountants, or CPA's to make the computations on their behalf. The cost of professional tax filers may vary, depending on what you need them to do.

A certified public accountant, or CPA, is an expert who prepares taxes. They do much more than that, of course, but that is one of many services they offer. He or she must pass their state's licensing exam before they can hang out their shingle and accept clients. CPA's hold a four-year degree or higher in accounting and know how to decipher the U.S. tax code.

The National Society of Accountants conducts a biennial survey of accountants to determine the average cost of professional tax filers charge to prepare personal income taxes. In 2010, those who hired a CPA paid approximately $95 for form 1040A and upwards of $229 for Form 1040 with a Schedule A itemized deductions form included.

There are many people who will prepare your annual filing. A tax preparer is a person who specializes only in the filing of taxes. With the exception of preparers operating in California, Maryland and Oregon, there is no educational, certification, or licensing requirements needed to become one. Anyone can be a tax preparer.

Often, tax preparers work at those national chains or independent offices you hear advertised and receive limited training regarding income tax filing. You will pay less for the services of a tax preparer than those of a CPA. According to Consumer Reports, the average client fee at the nation's largest tax preparation chain in 2009 was $172.

Using expert preparers has it's advantages because they will work with you to find every credit and deduction. Most companies will include free e-filing with this service. This will probably cost a little more and they may even offer you the option of taking a refund loan so you can get your money instantly. All you have to do is pay that loan back to them when your refund comes in like it normally does.

You can get your state return prepared at the same time as your federal return. It will cost a bit more, probably about half what you pay for your federal return. Keep all of this in mind when it comes time to file so you do not have any surprises.

Also, these are last years numbers and if you really want to know what the average cost of professional tax filers is you should contact several local preparers. Shop around to get the best deal and save yourself the hassle of trying to figure out the complex tax codes and lessening the chance that mistakes will be made.