Tax professionals use a variety of different methods to set prices, including per-item, per-form, or per-hour rates. For example, a practitioner might charge any of the following: Whether you use one of these methods, a combination of methods or some other approach to setting your fees, it’s a good idea to conduct an annual review in advance of tax return season to ensure that you are not shortchanging yourself. Your fee structure should factor in your cost, plus a reasonable profit margin. On the other hand,
you’ll want to make sure you are not charging more than the market will bear. While not definitive, comparative data on what other tax professionals are charging can be a useful guideline for assessing your fee structure. For example, the 2020-2021 Income and Fees Survey from the National Society of Accountants (NSA) provides some insight into the
fees charged by tax professionals for various tax preparation services. The NSA study reports the following national averages for Form 1040 income tax returns and a corresponding state return: The location of your tax
practice will have a bearing on the fees you can charge. For example, the NSA study found significant regional differences in the average fee for a Form 1040 with Schedule A and a state return — as well as variations within each region — with the highest fees reported on the east and west coasts. See the Income and Fees Survey for details. It is not uncommon for preparers to charge a higher fee to clients who submit their return paperwork at the eleventh hour or who submit a jumbled mess. The NSA study found that 75.1 percent of preparers increase their fees by an average of $145.14
for disorganized or incomplete paperwork to complete a return for a sole proprietor. See the Income and Fees Survey for details. The 2021 Intuit® Rate Survey results are in! If you were one of the almost 900 accounting and bookkeeping professionals who participated in the survey, you have our deepest gratitude! We are excited
to share the initial results with you. Over the next few weeks, we will be sharing the insights we learned in a series of articles that will be published on Firm of the Future. As in past years, the 2021 survey asked a variety of questions related to firm demographics, methods used to bill clients for different types of services, and of course, how much practitioners are charging for these services. This year we also
asked specific questions regarding COVID-19 and its impact on your firm’s gross profit margins and average fixed prices, while also touching on how our clients were affected. The survey asked practitioners how they billed their clients for various service offerings based on the following definitions: It is important to note that only 48% of survey respondents were willing to provide their average hourly rate. Based on the data available, however, it appears as though we gave ourselves a raise since the last survey was done in 2019. The standard average hourly rates increased by 8.6% from $69 (2019) to $75 (2021). Survey data also indicates that more practitioners in 2021 (35%) are charging the same hourly rate across the board for all services. This could suggest an effort to streamline billing rates or that services are being bundled. We also looked at the average hourly billing rates for QuickBooks-related services by both professional designation and ProAdvisor certification status. Editor’s note: This article was updated with new content on Dec. 7, 2020, and updated with new content on Jan. 27, 2022. The Intuit® Accountants team provides ProConnect™ Tax, Lacerte® Tax, ProSeries® Tax, and add-on software and services to enable workflow for its customers. Visit us at https://proconnect.intuit.com, or follow us on Twitter @IntuitAccts. More from Intuit Accountants Team Browse Related ArticlesIRS Lowers PTIN Fees for Tax PreparersTips and Tricks for Tax Season 2015Most Tax Pros Are Losing Profits Every Day
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