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Christian

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A client took exception to the price of his return so out of curiosity I'd like to hear what some of you think. His return is a Form 1040 with the following attachments.

Schedule A, Schedule B, Schedule C (he is a part time minister),Schedule D (two investment accounts),Schedule SE, Form 8948, Form 8949 and of course, his Virginia state return. I priced this return at $325.00 (bear in mind I am not a CPA or an Enrolled Agent) but still feel I did not over charge him. Any input would be appreciated.

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Tell him something to the effect that you are a professional being held to standards by the IRS and your years of training and experience well justify the price of his return.

If he continues to complain, strip out all his original documents, hand them to him and tell him the location of the nearest H&R office.  Wish him a good day.

You are NOT overcharging him.

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At first blush, your fee sounds reasonable.  It is hard to tell though. I have clients with that laundry list of forms that I charge nearly $1,000 because of the complexity.  And to the other extreme, with that same laundry list of forms, I can see $300 to $325.  So I think you are probably good.

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The prior preparer was probably charging less and figures his/her return is the same and it's not that complex and expects to pay the same fees, your fees are reasonable and I would probably charge the same or more.  This year I had a client ask if I was going to charge them more since last year I had increased my fees, I told them absolutely, my fee is going to be higher this year.  When someone tells you "oh it's easy" or "it's similar to last year", it's best to let them know it's going to cost more this year.

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I would have charged what you charged *only* if some of the schedules were close to empty - otherwise it would have easily been $50 more and heading north from there.  For anything that involves Sch D, I charge per item on the 8949's, so that varies wildly.  Some folks with five or six account might have three trades; someone with a single account might have three hundred - guess who pays me more?  (Yup; you were right.)

 

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I wouldn't charge for 8948, because I'm supposed to e-file.  It really depends on what work was involved on Schedule C and how much trading to enter on the various Forms 8949.  I would not be lower than $325.  Just completed a similar return with three 8949s and AMT that was $545.  And a recent return in which I could import his Gain/Loss statement (broker uploaded Excel spreadsheet to FileShare) that was $500.

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I am in VA, and not a CPA, and I think your price is very fair.

When I am questioned about prices, I tell the client that I don't aspire to be the cheapest, I aspire to be the best. I don't sell numbers and forms, I sell service.

Your price is good. And go up every year. Every. Year.

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33 minutes ago, Catherine said:

 Some folks with five or six account might have three trades; someone with a single account might have three hundred - guess who pays me more?  (Yup; you were right.)

 

I guessed the one with three trades pays you more because the single account's three hundred trades were all clean A's and D's with no adjustments so you just needed to put four numbers on Schedule D.  Was I right?

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4 hours ago, Lynn EA USTCP in Louisiana said:

You price is more than fair, and actually undervalued IMO.  I would have charged more, but I am an EA and now a USTCP.

Lynn

How many tries to pass the Exam?  Very impressed with you.  Please fill in the details.  How did you prep.  How hard was the exam.  I am thinking about going for it as well.  I have never talked to anyone who has taken, much less passed that exam.

Tom
Newark, CA

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Tom, this was my first attempt. I joined Sherrill Trovato's year (plus) long study program, www.taxcourtexam.com ,  did the monthly and then weekly assignments, participated in all of the live/in-person study events, joined a 5-person study group with additional weekly assignments and weekly go-to-meeting session (every Friday afternoon).  Every day I go to the tax court website and read that day's opinions and orders. 

The exam is 4 hours of writing, you must find a comfortable easy flowing pen and practice writing for long periods of time.  The exam is four parts - tax court practice and procedure, legal ethics, federal tax and federal rules of evidence. The exam is intense and draining. Since it is hand written it takes months to get results- they were mailed out by the court in early .April. 119 people took the exam last November and 16 passed, 12 of whom were Sherrill Trovato's students. 

Hope this helps,

Thank all of you who have expressed congratulations . 

Lynn 

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23 hours ago, Christian said:

A client took exception to the price of his return so out of curiosity I'd like to hear what some of you think. His return is a Form 1040 with the following attachments.

Schedule A, Schedule B, Schedule C (he is a part time minister),Schedule D (two investment accounts),Schedule SE, Form 8948, Form 8949 and of course, his Virginia state return. I priced this return at $325.00 (bear in mind I am not a CPA or an Enrolled Agent) but still feel I did not over charge him. Any input would be appreciated.

Since you didn't say anything about the client being disorganized, having an inordinate number of entries on B or 8949, or otherwise a pain, I'm going to say I can't charge this price here in rural TN.  But I am not THERE, where you are, so this information is not really helpful to you, but hey, I like talking to you all.  I think you'd have a much better handle on how you compare in pricing by calling some preparers around you.  I know we on this Board all EARN more than we make, but until IRS makes it really important to file accurate returns, we are stuck with charging what we can make. 

Maybe this client is one of those who are never happy, but the perception he has is that this price is too high for him, and he will go elsewhere if there is a less expensive alternative.  That's the way that cookie crumbles.  It's one thing to know your worth, but it's quite another thing to watch business go down the street.  I personally would rather charge $275 and HAVE a client than know I'm worth $325 but be sitting here watching the client parked over at Tammy's X-Treme Tax Returns.  Tammy is not going to the store for me.

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39 minutes ago, taxxcpa said:

Once someone asked me how much I charged.  I gave him an estimate and he said "That's pretty steep.  Last year I only paid $15."  I recommended that he stick to that highly qualified tax preparer.

One came in to pick up a text book my daughter was selling.  She asked what I charged and told me she paid $10 for prep last year in the next breath.   I wouldn't even waste my time giving her any price at all.  I told her to stick with him, see ya, bye, enjoy the book. 

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I appreciate all of your feedback. I feel comfortable with what I charged. While he keeps good records it always comes in by mail in a large jumbled pile at the end of the season due to the fact he has to wait for the amended 1099 forms from his brokerage accounts. I forgot the K-1 form from some fund he has. It takes easily 4.5 to 5 hours to address all of this plus he mails them. If he ain't happy he can just take a hike as I am too old in the tooth to fret over clients like him anymore. :D

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24 minutes ago, Christian said:

I appreciate all of your feedback. I feel comfortable with what I charged. While he keeps good records it always comes in by mail in a large jumbled pile at the end of the season due to the fact he has to wait for the amended 1099 forms from his brokerage accounts. I forgot the K-1 form from some fund he has. It takes easily 4.5 to 5 hours to address all of this plus he mails them. If he ain't happy he can just take a hike as I am too old in the tooth to fret over clients like him anymore. :D

Oh, see, I was guessing this took a couple of hours, tops.  I absolutely would charge this much for 4.5 to 5 hours.   Your teeth are neither old nor long. 

 

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