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All right, I cuss a little, but I love Jesus. And here is part of your problem - clergy (at least here in my little town) sometimes come across as feeling entitled to more for less. My mother used to practically give away her work to clergy. I undercharge everybody, but I don't undercharge clergy more. I have no problem telling them I have a ministry, too. My ministry is feeding my kids. And my kids are leaders in church and everybody has a ministry, not just pastors. I was furious that my pastor talked a kid out of playing professional baseball because he was needed on the church staff. What???? You can't witness on the baseball field???? OK, sorry I got off on a rabbit trail there. And, yes, my pastor makes more than me. He can pay for tax prep - they gotta get over thinking we owe them something. Nobody owes anybody anything, and yes, a workman is worthy of his wages.

From the Tax Pro Today series:

JJ. I want to bring up one more thing. You need to talk to a REALLY GOOD SS Disability attorney. They only charge when they get the disability, and while it should not be this way, it often is true that the SS personnel do not 'play fair'. But faced with an attorney, they do react differently. And the fact is, it is not WHAT sort of injury it was, it is HOW IT AFFECTED HER. Regardless of how others may have been affected. Please do not just give up. There are so many being given disability for ridiculous reasons, any legit claim should be fought until you get it. As for the price issue, just remind clients that the ACA, on top of all the other changes, has made the tax software more expensive, so the fee increase is not really to make you more PROFIT, but just to keep up with your costs.

I have several hairdressers, and it really is mysterious to them not being able to write off the FMV of do-overs. Also, face value of gift certificates. Sigh. So, I quit telling them, and they think they're deducting them. Everybody is happy that way.

You will hate Drake. 2013 tax year I used both. I will not go back to Drake for any reason. Drake is not intuitive enough for me. 2013 I raised my fees 25%. (not yet to the 80-85% mark Tom used) I have 200+ clients. I had 1 client complain and two ask. 2014 I raised my fees an additional 16%. Still not to the 80-85% benchmark. I may have lost a few clients, but have gained several new clients that didn't even blink at my new prices. More income than 2013. When we price our professional services at Wal-Mart prices we hurt our entire industry and other tax professionals. I have chosen to stop doing that. I am now an IRS licensed professional with 18 years experience and have decided if my prices are the reason some left, I am not losing anything. In the last two seasons I have had a total price increase of 45%. If I lose some customers, I have less work to do and make more money. The concept truly does work.

Employers are paying "contractor" wages when the person should be an employee to: Not pay 7.65% FICA Not pay Unemployment Insurance (breaking state employment laws) Not pay Workman's Compensation Insurance (breaking state employment laws) Not pay someone to do the payroll reporting It has nothing to do with payroll being stressful. It is all about the money.

It already started this morning and I had already filed two returns before I went to the Dr with my hubby. "Oh, you must be so glad it's over!!" What part of over don't I get? Rita's boot, indeed.

4 preparers year round. During season we add 3 more. From Feb. 1 to April 14 we are open Mon-Fri 9-9. Sat-Sun 9-4. The rest of the year we are open Mon-Thu 8:30-5:30. During off season I don't work on Tue. Total filed returns for 2013 tax season was 2,903.

And how many preparers? And is this a year round accounting practice? I need to compare myself to everybody so my self worth can be accurate. Got my hair done this morning. Hairdresser, non-client, talked the whole time about her business tax return she botched. Yeah, I'm gonna do it for her since she is afraid of her accountant but can't leave him because he knows the ins and outs of her very advanced and mysterious income tax return. Man, the last thing I wanted was to listen to a hairdresser talk about taxes.

Agree, and its not just small employers, but also medium size and large size employers like FED-EX.

Adding to Jack's list... not pay any other benefits like health insurance or matching contributions to retirement plans, and not have a higher unemployment rate if they decide to fire the person I'll agree with Jack on breaking state law by not having the person listed as an employee for w/c insurance, but the company isn't saving in that area because the insurance auditor will ask for the payts to independent contractors too. And if it works like here in DE, a single person owning their own business without employees does not have to purchase w/c insurance on themselves so the company they are working for would end up with a higher premium because of this.

I'm ambidextrous, just sayin.

Yeah, and after THIS season that comment is looking for Rita's boot in response. Rita - do you outsource?

I honestly think that is seldom the true reason. The real reason, in my experience, is that many will prefer to pay a 'contractor' more just to avoid all the hassle of employment tax REPORTING. Which is also why many workers will prefer that, because they see it as making more and the paperwork on their end is just the quarterly estimates and a slightly more expensive 1040. The small business owner with just one or two workers often finds payroll their most stressful part of their business. The federal and the state paperwork is worst, to them, than just the amount of their share of the taxes.

For whom? I hope you don't mean we should help people cheat by not asking questions. Half of us can only pay the taxes for all of us for so long, you know, till something breaks. Forgive me if I misunderstood your comment, but that's all I can come up with. Unless I missed the "/s". In that case - yeah, haha.

2903/10=290. Ok, I'm good.

Well, Rita, my hairdresser is my client. You are right about the mysteries of their returns. They can have a lot of things going on at one time. They can be an employee, a SE, and an SE renting chairs in a salon. Mine, for one, is extremely needy taxwise. BUT, she does a great job on my hair and pays whatever I ask for my services because she totally doesn't "get it!"

Put together your plan as if you're consulting for one of us. Probably $10/return increase, new clients at the full prices you're aiming for, freebies asked to pay $10 each toward (pick one) license fee or pay-per-return or e-file fee or overhead or..., always show full prices on your invoices with their true discount shown, charge for initial meeting/consult/questions for potential clients with fee applied toward their tax prep fee if they become customers, etc. If you end up with software where you buy the modules separately, you may need to drop your entities. Or, your only competition for entities, including 990s, is really CPAs, so you should increase their returns $25 or something more than $10.

Just got a call from a prospective new client. The coffee is working enough that I could actually have a coherent discussion about record keeping. Had a client whose return is basically done, but two of their charitable letters didn't have the required goods & services statement so it was on hold until we get new letters (these are thousand dollar donations, so we definitely want perfected letters!). Sent email to wife and didn't hear from her (they owe), so ended up just filing the extensions without a payment. Get an email & really early phone call this morning that I didn't answer; she flew last minute to Lithuania yesterday because he mother had a fall. So I'll have to try to walk husband (who is MUCH older - in his 80's) and not the computer savvy one as to how to pay online, or grab estimate vouchers from my portal. Might be easier to just overnight paper vouchers. Thank god the coffee is working!

I am still laughing at the "actively participates" part of Pacun's post.

"I'm busy" is an excellent reply. And if you're really into economy of language, you can cut the number of words by 50%. Just respond with "no".

Those are numbers for the entire year, not just tax season. 2 of our preparers do not do office appointment and only do mailed in returns. When you factor in 9 months instead of 3, the number is not so daunting.

2903/7 = 415. I'm not that good. But wait, there is hope - do you have non-preparer staff to shoot the bull with clients, answer the phone, run copies, file, clean the toilet, vacuum (yes, vacuum, we've talked about this before)?

AMEN!

I don't offer a New Client Discount. However, I do find I under-quote to a prospective client more often than I want (working on that) so for that situation, I show the full price and use New Client Discount to bring them down to my quote. Or Referred by a Good Client or Extension Discount or whatever fits. I do offer Loyal Client Discounts to continuing clients to keep their fees from jumping too much at a time. I also offer Referral Discounts after their referral becomes a client and pays. And, Family Discounts to the dependents or even extended family if the situation warrants. Or, Extension Discount if a client extends for my benefit. In other words, I'm more likely to discount for a continuing client and more likely to charge full price to new clients. My invoices start out with the forms filed, might add time-consuming line items such as Bookkeeping, Research, Revisions, Consultation, whatever fits, and then might include a discount if that feels too high. An example might be a really well-organized Schedule C with categories totaled for me vs. the shopping bag that probably gets an added line for Bookkeeping. I have a couple of clients that after I pointed out their Bookkeeping fees got better organized and lowered their prices.

Here are a few suggestions. Pay attention to the speed. Notice such things as load speed, how quickly you can navigate within the program, how fast you can change from one client to the other through the client manager, and how easily you can swtich between the input mode and forms display. Approach it from the standpoint that "fast and nimble" is normal & expected. Don't try to make it act like ATX (in exactly the same way that you wouldn''t expect ATX to act like Drake). It is a totally different environment, which I think is a huge plus. Run backups a few times and notice how they''re done before you can blink. It will perform in exactly the same way when you begin to load the program with client data. You'll probably notice that you don't need a NASA-quality computer to run Drake; it's very resource-efficient. There are some macros embedded in the program - you should run one or two of the simple ones just to see how they work. These are a valuable feature in the program once you learn how to use them. You can automate many tasks affter spending the time to learn how macros work in Drake - they are a valuable feature. Finally, and most importantly, I'd suggest envisioning yourself with 15-25% more free time, which you can use to take on additional work (or take the time off if you wish). I've heard skeptical questions about this assertion on several occasions and other forums, but I stand by it. The only people who make this discovery are those who are willing to invest the time, change their thinking, and apply thier reasoning skills in making the best business decision.

My 1040 & Sch. A fees each go up by $5 every year, as does my per hour fee. I'm working to get the base Sch. C up to $100. That covers the cost of the software. I also started billing at full price to anyone I discount and then showing the discount in stead of just discounting off the top.

Those were the words I used not to get stressed out this tax season, last year a couple of last minute TP twisted my arm to get their return done on time, not this year baby

I went to a practice management seminar many years ago with my father, (he was an accountant, I started taxes working for him). One statement made my one of the presenters really stuck with me. "If you do professional work, charge a professional fee".

Thanks for your sage input. To be perfectly honest, you're telling me what I already know ... but it somehow sounds so much more valid coming from someone else! I have always felt a little bit guilty for thinking those kinds of thoughts! The majority of my clients are clergy (I'm also a part-time pastor)--I use that as my excuse for sub-market fees. Most of the freebies are either family or retired clergy who have little or no income. I also tend my waive my fee if the client is in the midst of a legitimate hardship. When I started doing this a hundred years ago I was pastoring full-time and my wife was working full-time--what I got from tax prep was gravy. Six years ago my wife suffered a seemingly minor head injury that suddenly turned into a major, life-threatening illness from which she has still not recovered. We lost her income (Social Security has repeatedly denied her disability with the excuse that other people who suffered her injury are able to work so she should be able also) and having to care for her rendered me unable to continue pastoring full-time. So now my consulting gig is all I have now (the small church I pastor contributes a very small amount). About 1/3 of my income goes to pay her med bills. That is what prompted me to search for something less expensive--these days I need to conserve every dollar I can. The truth is that I probably need to do a serious re-evaluation of my business model. Here's the pathetic part of all this (confession is good for the soul!)--part of what I do is business and personal financial counseling. I regularly counsel people like me. And they end up doing very well. If I were counseling someone like me I would be telling me to do things very differently than what I've been doing. You're right. I'm a goofus! Sounds like I have some work to do.

Yes, it did take forever, and you're welcome. I was hoping to be helpful as well as self-deprecating. It makes me feel better about the whole boot incident.

I'm finally finished! 102 extensions. I can't believe how many people showed up today. I even got a 2013 in that I thought I had lost. Tomorrow my first excursion away from the house since Easter is to take my son to have his wisdom teeth taken out since he ended up in the ER last week in KS with severe pain and a very bad infection. I don't know why these things can't happen when he's in town. Fortunately, he didn't fly down there or we would have had to drive a pilot down there to fly the plane back that lets him borrow it. Then I can finally get my haircut after I get him home so my husband can watch him. We were going to a movie, but that's out for now. Thanks to everyone on this board. Now I have to get back to quarterlies, sales tax and property tax returns.

Yes. Does he use his own truck? Of course, he could probably argue successfully that he's an employee, but he also would probably find himself out of a job.

This post coattails on JJStephens post entitled “Tis the Season (aka Here We Go Again). Is anyone willing to provide their approximate fee schedule? Are your fees based solely on forms used or is it based on time spent? I have a day job and prepare returns at night and on weekends for approximately 100 clients. My base fee is anywhere between $125 and $150 (depending on how I feel that day and if I like the client ) for Federal 1040 and one State. That fee covers W2, normal interest and dividends and Schedule A (I guess you could call it a more basic return). If I start adding forms my price will increase accordingly but I do not have a set fee per form. It depends on how much time I spend on it. Prepping a Schedule C may add $25 or significantly more depending on the amount of work that's involved. Stock sales would also increase the fee. If there are only a few sales it would probably stay right inside that $125 to $150 range and not add any additional charges. If there are more sales, my price would go up. I also offer a new client discount. So my invoice states the price of my service: Preparation of Federal and New Jersey Personal Income Tax Return $ 150 New Client Discount $ -25 Total $ 125 In my initial meeting, phone conversation or email exchange (there are many clients I have not met face to face who have been with me for many years) I indicate that my price is dictated by the amount of time and work involved in preparing their return. After looking at the information they provide (including a copy of the prior year return), I give them a general idea on what it should cost. I do not indicate there will be a “New Client Discount”. I think they are pleased to see a small credit on their invoice and it may result in some goodwill and also prepares them for what the fee may be next season. I believe that the majority of my clients value my services greatly. Those who leave due to a price issue are not those who want to establish a long-term relationship. And that's their right but I don't lose sleep over those clients. Ultimately, as a preparer we have to recognize the significant amount of knowledge and value we bring to the table and our returns should be priced accordingly.

It is almost always better, financially to buy rather than lease, the panels.

"Fixed income" only means that their income does not change for the whole year even if they do nothing. It is not reason for me to "feel sorry" for them. I grow weary of the retired folks using that term to garner sympathy. I wish I could have a steady stream of income that would not change, then if I needed more, I can do part time "something." "Lack of retirement planning on your part does not create the need for me to donate to you on my part."

I also throw in discounts depending on the event such as births, graduations, new home, etc. I agree that clients always like to see a credit on their invoice and as I mentioned, I do believe it generates goodwill.

Humming right along doesn't mean the speed at which it humms can't be greatly improved. I too have a fairly new computer and am so disappointed in the speed at which the program opens and operates in general...snail's pace! I'm tired of being told I need to upgrade my computer almost yearly for a tax program that could be programmed more efficiently than it is. After this past tax year, especially, I have come to the conclusion that I will no longer tolerate the second rate tax program ATX offers. The effort I have to put out in the conversion from ATX to Drake will more than pay the dividends for the tax year of 2015 I have been loyal to ATX for too many years....while paying retail each year at that! I can't believe I put up with paying retail each year because I didn't jump ship when it would have been so easy to do so.

Interesting. I'm probably a bit too much of a people person for my own good. That's a good trait when I have my pastor hat on; not so good when I have my biz pro hat on. As for Drake--I've reached a point that it is the only thing I am willing to consider in lieu of ATX. During my one year off from ATX I used a product that was somewhat similar to Drake. It took a bit of learning but I got the hang of it. I've demo'd Drake half a dozen times during my 28 years as a preparer. What I've discerned is that those who love it really love it and those who don't really don't. Over the next couple weeks I'll find out which I am from the demo I ordered. Anyway, I'm excited to launch my 'reinventing the way I do business' project over the coming days and weeks. Thanks again for all the great input.

I completely agree with the fee issue. Most preparers I know tend to undercharge, so there is lots of room for them to increase fees. But as much as I agree with the fee increase approach, i disagree to the same exten with respect to Drake software. Given the quantum leaps in speed and efficiency Drake clealry provides, I'd have to say that anyone who ends up hating Drake also hates earning more money. It really is just that simple. I have found Drake to be very intuitive once a person devotes the time to reach a reasonable level of software transparency. But the learning curve can be steep if one approaches Drake with a closed mind. A bias toward the crutch of forms-based data entry is also a barrier which some people just can't overcome. But once the user opens their mind and begins to evaluate the entire user experience, it is impossible to ignore the efficiency aspect. So the decision is less about bells and whistles and more about answering the business question of "What makes me the most money?". In my case, that's a major issue since my reason for being in business is to mximize profits, and is the reason I'm convinced that Drake is the answer in this price range. SO it offfers anyone increasing their fees to also increase their profitablity exponentially, if they have the courage and business acumen to do so.

Semantics. Not relevant to the situation being discussed. Schedule C business. NOT a RENTAL. Trying to redefine the tax laws does not change the tax laws.

Aren't short term rentals Schedule C? Less than seven days, or something like that? If she rents a room a day at a time, isn't she running a Schedule C business?

Well, I am in the same boat as JJStephens. All I have heard the past few days from my new Assistant and my Husband is "You have to raise your prices!" Easier said than done, but I am working on it too.

The couple's ages would only be a factor if they had no qualifying children. If they DID have qualifying children and still met the other tests, then they could still have claimed the EIC. But I agree with you, the EIC is gone for them.

There is a similar biblical principle that says a laborer is worthy of his hire. I teach it, I preach it. I just don't do it! I've always subconsciously based my pricing on 'how little can I charge and still pay my bills and keep from starving.' If you could see me now you would notice that I have a stupid sheepish grin plastered all over my face as I slowly shake my head. This is timely in another way. Over the past month or so I had come to the conclusion that I was going to have to adjust my consulting/accounting fees as well (they have been similarly under-priced). I had come up with a tentative plan that involved a nominal increase. I've been kicking myself for not having already sent out the new price sheet. Now I'm glad I didn't. I think I'm going to have to approach it with a different perspective. Hey everyone, thanks for your input and allowing me to think out loud. This has been really helpful.

This is just me talking here, but you are giving your services away. You don't have a software issue (not saying ATX does not have issues, but that doesn't look like your problem). You have a business model issue. If you want to place your business in the value category below the Big Boxes, then be at 85% to 90% of their cost. You may lose a few customers in the short run, but in the long run, where are they going to go? To the big box to be treated like cattle with no off season support? How about those 990 clients? They going to go to the green box for that work? Or a CPA who is going to charge them a boat load because they have a soft heart for their profit margins and not the client? Again, positioning your practice in the value range is fine, but do some research on what the big boxes are charging, what CPA's and EA's are charging, and price accordingly. 60% of the big box store is giving it away. You seem to have a great client mix that you can work from. (Not sure why you would do 30 freebies, but that is your choice. No value judgments here). Some are captive (990's, P/S, 1120, and any of your Sch. C's & E's), so those are probably going to stay or get a real education on the going rate for business and non profit returns. The 30 freebies are not leaving either. Just my humble opinion. Have the moderators delete if you don't want to look at it again. Tom Newark, CA

Yes, and for the next month, every time you meet a client anywhere, grocery, bank, drug store, etc, you will hear "Guess you are enjoying not having any work to do now that the 15th is behind you." LOL

Thanks to everyone!! This board is a wonderful resource because of the wonderful people. Take some time to relax, hang with family, and thank them for putting up with us during this time. Off to pour a drink and not worry about tomorrow.

Finally DONE!!! Filed the last extension and transmitted the last return. It has been a grueling season and I hope everyone here has had a good one. Time for some much needed rest for all.

Another Tax Day has come and I am finished with what needed to be done for today. Extensions await me but that can be handled over the next month or two. Thanks to everyone on this forum for their support and sage advice. It's very much appreciated! My best to each of you for an "off season" filled with nothing but good health and good cheer!