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Travelwanted

Recycles dryer sheets
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My CPA has been charging us about 900/year for a pass-through income LLC return (simple return) and another 2500/year for personal return.

Recently they charged us 1200 to revise 2 years at their direction because they recharacterized some income. It saved us a lot in taxes so I was happy.

I hate to complain but we are out 4500 plus already this year in CPA fees.

Does this seem rather high?
 
Travelwanted said:
My CPA has been charging us about 900/year for a pass-through income LLC return (simple return) and another 2500/year for personal return.

Recently they charged us 1200 to revise 2 years at their direction because they recharacterized some income. It saved us a lot in taxes so I was happy.

I hate to complain but we are out 4500 plus already this year in CPA fees.

Does this seem rather high?
Click to expand...

What's his hourly rate?
 
$2500 for your personal return seems outrageous to me.

Until a few years ago, we had our personal tax return professionally prepared for $600. I wasn’t happy paying that, but it was safer than trying on our own and getting it incorrect. We have a rental real estate, other business income, and pass-through income from an LLC. Our return has it all: Schedules A,B,C,D, and E.

After two years of following along (I would do our taxes with Turbo Tax before going to the accountant, then compare answers) I felt confident enough to do it myself. You could try following along for 2019. It might be simpler, now that the standard deduction has about doubled.
 
You could also probably still get TT for 2017, and compare the results with your accountants, and judge for yourself how much work it is. Don't cheat and use anything from the prepared return.
 
Travelwanted said:
My CPA has been charging us about 900/year for a pass-through income LLC return (simple return) and another 2500/year for personal return.

Recently they charged us 1200 to revise 2 years at their direction because they recharacterized some income. It saved us a lot in taxes so I was happy.

I hate to complain but we are out 4500 plus already this year in CPA fees.

Does this seem rather high?
Click to expand...

I do my own but those rates seem high to me, particularly the personal return... I assume that you must have a complex return if they are charging you $2,500. Assuming $100/hour (and that is a bit high for tax prep only) that's 25 hours... but it really dependon the complexity of the return and how much chasing of information that they have do.

I don't understand the recharacterization of income '"at their direction"... they mischaracterized it to your detriment to begin with and are then charging you to recharacterize it to your benefit? Smells rotton.
 
CPAs are expensive. I paid 3 grand one year but that was for 6 returns the year my Pops died;

2 for him
2 for me and
2 for the Trust
 
I had a CPA do part of my taxes on a real estate partnership liquidation. They told me that if the IRS questions the Schedule K-1, they were going to have to charge extra for their time to investigate the info. Heck, the CPA was our partner in the real estate venture. You would think his tax into was right.

I prefer to keep my business simple enough to where professionals are not needed. They often make things just a little complicated.
 
RunningBum said:
You could also probably still get TT for 2017, and compare the results with your accountants, and judge for yourself how much work it is. Don't cheat and use anything from the prepared return.
Click to expand...

+1

IMO the largest cost of using a CPA is that you do not learn the connections between your income and its taxation and consequently you are likely to be invested in a suboptimal manner for the purposes of tax reduction.
 
About 10 years ago I had a falling out with a long time CPA that dis our business & personal returns. I don't remember the cost there. I switched to a suburban office CPA. Pretty good size firm. First year was like $2500 for business and I think $1500-2000 for the personal. I was a bit shocked but figured they had to input a lot of data from old returns. Next year? Same price. That is when i got pissed and started looking around. Found a CPA one State over. $800 for business and $600-800 for the personal. It's great. I like her a lot. She is pretty good size and kind of specializes in small business. The kicker from the old firm? The new CPA wanted the returns in digital format. So I asked. They charged me the same amount as if they had done the full returns. $2500.
 
Scrapr said:
........The new CPA wanted the returns in digital format. So I asked. They charged me the same amount as if they had done the full returns. $2500.
Click to expand...
Wow, would have been cheaper to have someone input the data from the old forms.
 
OP - Are your personal taxes that complex ??

I agree with posters, you should get the TT software (or taxcut) and do your own personal taxes for last year, and see how close you are to the professional return.

Sure it's a little work, but you learn a lot and can become a smarter investor as you will know the tax implications of various actions.
 
There is no way to answer the question from the info provided. Depends on complexity of return, hourly rate of preparer and staff and their perception of your fee sensitivity.

I do my own but in a prior life I did tax work for a big CPA firm and even back then we saw plenty of 10k+ returns.
 
travelover said:
Why wait? :LOL:
Click to expand...

Too funny!!!

OP I'm in California, pay $1200 for my personal return (not too complicated). Also pay about $3000 to the same accountant for handling the bookkeeping and returns for my S corporation.
 
S-Corp: I pay my CPA about $700 to prepare and file yearly tax returns. Returns are simple as it’s a simple “part-time” one person business, and I’m a meticulous bookkeeper. In addition, I pay a payroll service $50 per month for everything payroll related.

C-Corp: Same as above except about $900.

Personal: CPA about $120. I believe he pads the above to to keep the personal fee low (a fairly common gray area practice).

This is in a very HCOLA area.
 
Last edited:
Our personal tax return, plus an appointment once/year to do tax planning, costs us around $850. Our taxes aren’t that complex, but we do have carry forward losses on investment property as well as stocks. I like the idea of trying to do it myself in TT. We might keep the CPA anyway though. We were audited once for 2 years, and the IRS got nothing. I think having the CPA correspond with them helped.
 
Guy with LLC and personal taxes to be done walks into local accounting emporium.
"How much would it cost to do my personal and business taxes?"
"How much do you have?", asks the CPA.
 
Philliefan33 said:
$2500 for your personal return seems outrageous to me.

Until a few years ago, we had our personal tax return professionally prepared for $600. I wasn’t happy paying that, but it was safer than trying on our own and getting it incorrect. We have a rental real estate, other business income, and pass-through income from an LLC. Our return has it all: Schedules A,B,C,D, and E.

After two years of following along (I would do our taxes with Turbo Tax before going to the accountant, then compare answers) I felt confident enough to do it myself. You could try following along for 2019. It might be simpler, now that the standard deduction has about doubled.
Click to expand...
FWIW, A tip for people who are starting out with their first job, it is easier to start doing your own return from beginning and it will stay easy as your financial affairs grow complex. Simply due the fact that the complexity is increasing gradually so the learning curve is smooth. I have been doing my own return (paper back then) starting with 1040EZ -> 1040 -> ..... -> Now 1040 with schedule C, D, E and LLC pass-through income. To be honest, I would not do my own return today if it wasn't for the help of modern tax return softwares.

OP: I don't have any experience with CPA service for personal returns but for our 9 member LLC, we pay $600 to the CPA. FYI: We the do the record keeping. I think record keeping can add a significant cost to CPA services.
 
We pay our CPA/attorney a flat rate of $1K per tear for taxes, tax planning and other financial consulting. For our eight figure portfolio, there's a fair bit of complexity regarding taxes and planning. In my humble opinion, $2500 for just tax returns is quite high.
 
That fee seems very high.

Though I suspect fees are in the increase. I suspect CPA insurance rates are increasing because of litigation. Several of the big firms have been hit with some large settlements for incompetent work/audits.
 
Any reputable CPA will transfer your file and electronic returns to your new CPA at no charge (or minimal charge). Something is not right, given you said it was a larger firm.


Scrapr said:
About 10 years ago I had a falling out with a long time CPA that dis our business & personal returns. I don't remember the cost there. I switched to a suburban office CPA. Pretty good size firm. First year was like $2500 for business and I think $1500-2000 for the personal. I was a bit shocked but figured they had to input a lot of data from old returns. Next year? Same price. That is when i got pissed and started looking around. Found a CPA one State over. $800 for business and $600-800 for the personal. It's great. I like her a lot. She is pretty good size and kind of specializes in small business. The kicker from the old firm? The new CPA wanted the returns in digital format. So I asked. They charged me the same amount as if they had done the full returns. $2500.
Click to expand...
 
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