Average Cost for Tax Prep
 

I'm confused and lost AF right now and could use some feedback. Straight to the point: my tax lady just invoiced me $950 to file our taxes...this is nuts and I'm livid.

In my early 20s I would file with my parents. Mid 20s I filed myself using Turbotax. When I got married last year, I decided to use a CPA because I didn't want to mess anything up. Our (wife and I) financial portfolio is very straight forward...I'll leave it at that, trust me. Honestly, I've never heard of anyone paying over $300 for preparing taxes and we're just average middle-class citizens. Am I missing something? I emailed her back saying she must have made a mistake. This is my first time using her and definitely last. I even asked her, on average, how much it would be to file our taxes. She told us anywhere between $150 to thousands depending on assets and whatnot. Trust me, I'm no Warren Buffet. I provided her all our information, in an extremely organized manner, early this year way before the global pandemic and she just got back to me tonight saying our taxes are done and invoiced us the $950. I refuse to pay this, but I'm willing to amicably resolve this with her. Please help and/or provide suggestions. Can I back out of this and re-prepare my taxes with someone else??

THANK YOU.

That is a fraud and absurd! Yes you can back
Out if she has not filed your tax yet to the IRS. Ive been using my accountant to file my W2 filed jointly with my wife and pay only $100 every year.

Do you have a business that she/he had to do book keeping for the whole year?
How many jobs or W2 do you have?

I do have 4 W2 meaning I work 4 jobs with different hospitals and she my accountant only charge $100.

Is your account office is in New York or in Somewhere in Manhattan?
You can demand an explanation why it you where invoiced that much.

As you have said your is just straight forward. Did you have a refund from your tax?

You got a scammer for an accountant!

I've had one job and some benefits through my job like stocks and what not since I graduated school...pretty average. I do not have a business. My wife was from PA, but she moved to MD last year. She worked one job and did a contract job through her same job for a couple months. She currently has one job right now. That's 3 W2s right there. The only complexity I can think of is that we got married mid year last year, so I'm not sure how exactly that works in terms of prepping files, but I still think $950 is absurd. I asked her for a breakdown. She is in MD as well. We got a very small refund. I'm starting to realize she is a scam. Her Google review is solid, but her Yelp (which I did not see until now) are terrible. There were some people people who said she deleted their bad reviews.

That seems outrageous to me. And my ex was a CPA and got certified with the IRS as a paid tax preparer for a side business where she filed taxes for personal friends and acquaintances. I know what goes into them even when a business is involved - it's not rocket science. Typically she charged $75-150 for a tax return and spent maybe an hour or two on the entire process.

Currently, my accountant bills $300 for my taxes, although they never charge me. I perform basic IT services for them in exchange.

I can't recall 100%, but I vaguely remember signing something with her basically saying we will pay her what she charges at the end of her services. Or maybe I just made that up in my head. Either way, I definitely ****** up, but I think it's partly because I was expecting to pay up to $300...not $950. That being said, if I really did sign something like that, she could technically charge me $10k - what's to stop her? There's has to be some sort of reasonable amount for this. I really rather settle with her and pay no more than $500 to get out of this mess with her...that's best case. I rather not take legal action because that would probably just end up financially worse for me. Is there any other way to get out of this?

With 6 different incomes between me and wifey, plus we itemize. Our CPA charges us roughly $170.00 a year. Depends if we throw something different at her year to year.

That $950.00 would get someone shot. :shakes head: How you get out of it. I don't know since they have all of your paperwork.

Here's my 2 cents. I work at an accounting firm where the bulk (~95%) of our revenue is tax work. Is $950 outrageous for a return with the items you labeled? Absolutely. I don't make or quote the prices here, but if something like yours came across my desk I would imagine $250-300 max (at least here locally). Sure some places are a bit cheaper like Rusty said, but that's location based and how much the accountant actually wants to make. Have you had many back forth emails, phone calls, or correspondents with her? Could be a contributing factor as that's how some of our clients billings are higher. When she does send you an invoice it should have a breakdown at least of what forms are being filed, and if any special or meticulous work there should be a further breakdown.

Regardless you're definitely being bent over.

For our clients if they're unhappy and want to go somewhere else, no problem we'll hand you back all your original documents no questions asked and cordially. OP did you prepay anything at all and is the actual return finished? What stage is the return or process currently at.

Thanks to all of you for the affirmation and letting me know I'm not crazy. So after a lot of back and forth and basically a burned bridge, I paid her $500 because that's the most I was willing to pay even though I was expecting $300 at the most. She obviously did not like that. There are a couple things to note here. One, I did sign a legally binding contract that basically said we owe her whatever she charges (again, this was stupid of me in retrospect, but I never thought it would be this bad). Two, she explained how she had to do all these extra steps for us. My issue with this is some of you who responded clearly have a lot more to deal with and your filing costs seems completely reasonable, if not, low in some cases, so there's just no excuse for the $950 - I don't care what she says about that. Three, I could be wrong, but I couldn't walk away because she did complete her services and was ready to file. If I walked away that would have probably made matters worse and she has all our information.
All things considered, we are moving on with life and definitely with a different CPA. However, I am worried she may try to mess with our filing to get back at us and I would never know unfortunately. She emailed me "one final time" with all the reasons why it was $950 again and how she was rightful to charge that much and ended with "I will write off $450, the balance of your invoice, as a bad debt." I'm assuming this is for her internal bookkeeping for her business and not a collection agency on our behalf...can anyone confirm?

ARE THERE ANY TRUSTWORTHY CPAs IN THE PA/DMV AREA ON THIS FORUM??? Would be nice to know for the next go-around!

She sounds like a piece of work. If she was willing to go down the price she knew she was overcharging. Our firm doesn't haggle on price because we know exactly how much it should cost and how much it will be everywhere else. As for the letter you sign, did it say you owed her the full amount no matter what? We have our clients sign an engagement letter which goes over the generalities of how all info you give to us is correct to your knowledge, wait time, we don't file until we have payment and signatures needed, etc.

Honestly my bet is she had something similar that required payment to file. We've had clients we prepare a return for where the invoice is anywhere from $500-$1000 and end up not liking the return and go somewhere else. It is what it is, sometimes you can't control that bit. From my understanding she shouldn't be able to hold your documents "hostage" but who knows, at least its settled. What I would do is have ask if she can send the proof of e-filing. There's two main software's tax firms use. Once a return is e-filed, it may take a day or so to be accepted by both the federal and state government. We don't send this to every client as it'd be a waste of time and we only contact them if there's an issue. If someone requests it, sure I'll send it to them.

Normally you'd be able to check the status of your return on the IRS website but it's an over trafficked mess right now that even if you enter all your correct info (SSN, refund amounts submitted, etc.) it will say they don't see you in their software. Tons of our clients have had this issue and its just the nature of COVID's effect on the IRS also. Best of luck to you and at least she's out of your hair now!

Ummm... yea... did you at least get a reach around? Seriously, I’ve never paid more than $150 from my CPA, and that’s with filing jointly, self employed, with 3 IRA’s, Stock holdings, capital gains and dependents.

Hey, I think the $500 you paid was more than reasonable. I respect you for taking the high road even though you didn’t have too.

As far as “a bad debt”, don’t worry about it, there is nothing she can do once she accepts your payment. Collection agency’s have no legal authority until they go to court and get a judgment. That will never happen as it will cost more for filing and legal fees. Also, a CPA is not going report you to a credit agency for basically the same reasons. The only thing she COULD have done was file a “theft of services” complaint, but that ship sailed when she took your payment.

I wouldn’t lose any sleep over this, as you did everything you should have. Actually, you even went overboard, but at least you won’t lose any sleep over it.

PS: I hope she got you a decent refund?

Tell her that she is incompetent at her job if it really took her that much time to do your return. A competent CPA would have done it for less than half the amount she charged you. Fùck that bitch.



I'd be interested to see her reasons excuses why she charged so much.

Thanks for the tip. I'll check it out. As for the the letter we signed, I don't have a copy (another red flag and, again, my fault). I can't remember exactly what it said other than what I had mentioned in my OP. I really do hope she's out of our hair now...only time will tell. Her last email to us also said she would no longer be communicating with us, so yeah...

Thanks, man - appreciate it. $101...truly some BS.

Like I said before, I'm not too competent with the tax world, but she threw every excuse/reason at us. None of it sounded right to us. She bragged about all her degrees and how low her rates are (the rates we didn't even see). Honestly I feel so stupid about this whole thing. I should have known better and I usually make calculated decisions...I supposed I was due for a bump in the road. Mind you, she complained to us about having about 7 turn overs because the admins she would hire to help all sucked apparently. She even made fun of someone for being fat. I can't even believe I'm saying that and complaining about doing business with her. However, I make note of the turnovers because the admins were getting confused with out paperwork. They reached out to us at least twice asking for the same thing that we had already submitted, and one time I even dropped in to make sure they had our stuff and didn't lose it - you will see her response to this below. She probably had no idea about her admins reaching out to us in redundancy.
Anyways, you asked about her "reasons:"

Before I close your account, I feel the need to respond to some of your comments below . . .

You mention that you “aren’t feeling good about this at all and we are very concerned.” I’m not clear on what you are “concerned” about.
I don’t know why you were expecting to pay $300 for your returns. I never quoted you this amount. Nor did I tell you that your return would be somewhere between my minimum of “$150 and 1000s”.
Me, “as the expert in this field,” could not have given you an appropriate estimate for your return at our first meeting, as you neglected to bring all required documents, including things you were specifically instructed to bring with you. When you unexpectedly showed up at my office on another day with additional documents, I was meeting with another taxpayer and couldn’t review anything with you. There was still information missing that was important and relevant which we only found out after subsequently e-mailing you on several occasions. As I recall, I never did receive the health insurance forms we asked you for. I can only give an accurate cost estimate if I have all required information.
May I remind you that you signed a legally binding contract to have me prepare your returns. My obligation to you is to prepare the returns accurately. Your obligation to me is to pay me for the work completed. How the billing is determined is detailed in the engagement letter and is based on the time and complexity involved in the preparation of complete and accurate tax returns. Taxpayers are not invoiced based on their ability to pay, what they think they should pay, or what they want to pay.
This same engagement letter also specifies that you are allowed 15 minutes of my time to answer any questions about your return. I have spent way more than that amount of time trying to explain to you what is involved with your returns and why I charged what I did. Maybe when you get the package you will better understand what is involved.
And finally, I recall you telling me you gave me your business because you read my good reviews online. Those are reflective of my professional services. I feel I need to share with you that you are the ONLY client that has complained about my invoice this year.

That being said, I will mail your package out to you in the morning. I will transmit your federal return today. And I will write off $450, the balance of your invoice, as a bad debt.

This will be my last e-mail as I can’t incur any more time on your behalf. Good luck to you both.

Sounds like she charges by the second, not by the hour. Plus she can't spend anymore time with you because she can't charge you. A real class act. :shakes head:

Is this Shark a lawyer too? She sure bills like one...

Dont pay her dude... just give her $20 for her time. Then get all your documents and file at turbo tax free.

BabyZilla please tell me the truth did she do a Monica Lewinsky on you why she charged you that much!!!

Dude pay up you got your load as refund!

That 15 minutes is for explaining the contents of your return. Her explaining why she overcharged you is not part of that time. What a cvnt :shakes head:

The situation with her administrative help is very telling as well.

One way to get a quick idea on amount of work done is to see the forms that needed to be filed. However, assuming you’ve accurately summarize your 2019 info, I don’t see a $950 amount of work.

The only thing that hasn’t been asked is, did this CPA ask for your prior years’ returns? Did she file amended returns for your previous DIY ones? Highly unlikely I would think.

If she gives a detail breakdown, please post it, would love to see the reasoning.

FYI, you are entitled to get your paper work back without paying a cent. And the engagement letter doesn’t handcuff you to fraudulent charges.

@babyzilla - Given that she took the time to provide you with the arrogant and long-winded response you posted, has she provided you with an itemized invoice of the services she performed? I ask because in her message to you, she states, "How the billing is determined is detailed in the engagement letter and is based on the time and complexity involved in the preparation of complete and accurate tax returns." That is, as I like to say, "specifically vague." Meaning it's a way for her to charge whatever she wants without having to be accountable for the actual work she will do before she even does it.

I skimmed over this thread, but haven't read every word, so my apologies if you already mentioned she gave you an invoice. If she did, please post it, if you don't mind sharing.

As far as the "bad debt" that she's "writing off", tell her to kick rocks and get fvcked.

I tell my self never mess with a banker!

Memphis has spoken! You cant get any better advise than what he said.

Walk out and tear up that engagement letter like Pelosi did in the house of Senate!

:rofl2:

This is good to know - thank you.
Yes, she asked to see our 2018 returns, but she did not amend anything, at least not that I'm aware of. The only reason why I wanted to complete the service with her is because I wanted to finish in a professional manner and I wasn't sure what she was/is capable of. Life lesson learned for sure. Last thing I need is the IRS after me.
Her first detailed invoice was basically "2019 tax return" and cost of $950 LOL so I asked for a more detailed one and this what she provided:

Just posted it as an attachment in a previous response! Totally agree with your comment regarding the contract is her way to charge whatever she wants. I'm truly curious who her client base is. There's no way she's charging rates like this to everyone and getting away with it and I'm the only f***er complaining.

Ah I see. I am in Texas and no state income tax. I am unsure what typical additional costs are for state tax filing.

I highly suggest for you to consult another local CPA on approximate pricing. Or, go to a CPA forum and provide the same details, should receive honest opinions there.

The “Married filing separately” caught my eyes. Although one is still entering the same amount of info into the system, it may be possible that she is charging your and your wife returns full price for each, as if it’s for two separate person.

$400 for the joint federal is higher than I’ve seen tho....based on what you’ve said

I'm in Pa. with a state income tax. I've never paid over $250 for any tax prep.

Thanks for posting the attachment. She was nickel-and-diming you, in my opinion. That said, you did get the bill down, so that's a win. I'd imagine you shouldn't have any trouble finding a CPA to prepare your returns next year for a lot less.

One other thing - I'm big in to relationships and always suggest that my clients interview three or four (or more) CPAs to find just the right one. It's worth investing your time to do this and, if a CPA isn't willing to have a 30-60 minute conversation during their off season, they're the wrong one anyway and you can easily weed them out. The goal is to find a CPA whom you trust, enjoy their personality, has a great support staff, and that actually asks YOU questions. You don't want an order taker. Think of your CPA as a member of your household's Board of Directors, which also includes a good attorney, a good financial adviser, and even a good doctor. All of these should be experts, add value to your life, and be there to shepherd you and your family when making some of life's biggest decisions.

Lastly, a good CPA shows their real value for any work they do for you other than preparing and filing your returns. That, quite frankly, is the easiest part of their job.

Sorry for my ramblings, but thanks for reading.

Dude your Irish Mafia you dont pay taxes!

Actually, I think he's an honorary member of the Native American Mafia ;)

That is no rambling. I'm not sure you could have put it any better :tiphat:

Might have been the best and most usable advice on this forum lol

As a CPA in training I can give you some insight.

Every CPA has a hourly rate in which they charge, always ask what that rate is. Some have previously worked for the Big 4 and will charge a massive rate because of that.

Secondly it depends on what they are filing. Is it a personal return? Where you have one source of income? Multiple sources of income such as investments, rental properties? Is it for you and a partner?

You need to leave this leech of a CPA. Go around, ask different CPAs for their quotes and get a feel for them, it is more than a numbers game, trust me.

Regardless the amount you were charged is absurd, leave and find someone else.