2019 Tax Professional Fee Study · 2019-08-23 · When it comes to tax preparation fees, how do you...
Transcript of 2019 Tax Professional Fee Study · 2019-08-23 · When it comes to tax preparation fees, how do you...
We gathered and analyzed the data from our 2019 Tax Professional Fee Survey. Inside, you will find a summary of the most critical details relating to what you charge for professional services. 2018 data was included when available and significantly different from 2019 results.
The information provided in this study gives you a distinct advantage over tax professionals in your area who are not NATP members. Knowledge is power and knowing what your peers charge gives you the power to be competitive with your pricing and still earn what you’re worth.
When it comes to tax preparation fees, how do you compare to your competition?
2019 Tax Professional Fee Study
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Designations (more than one could be checked)
Years in Tax Business
Respondent & Business Profile
Less than one year equaled zero.
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Total Number of Employees Number of Total Employees who are Preparers
Employment Role
Respondent & Business Profile
Tax office employees include administrative staff and tax preparers. In 2018, 63% of employees were tax preparers
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Tax Client Target MarketClient Community Size
Respondent & Business Profile
Percent of Revenue Derived from Tax Prep
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Services Offered: Percent of Gross Revenue
Overall Gross Revenue
Gross Revenue Earned
Respondent & Business Profile
Types of Tax Consulting Offered
2018 2019
Amending previous tax returns 4% 2%
Calculating proper W-4 witholdings 1% 0%
Estimated tax projections 2% 1%
Filing a paper return 2% 1%
Reviewing returns done by someone else 1% 1%
Tax consulting 4% 3%
Tax examination protection 1% 0%
Tax examination representation 3% 2%
Tax planning 3% 2%
Tax preparation 70% 65%
Tax reform consulting 1% 0%
Financial planning --- 2%
Payroll taxes --- 4%
Bookkeeping/monthly accounting --- 13%
Other 10% 2%
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Looking to Expand Services
If Yes, Services Being Considered
Business Plan
Respondent & Business Profile
Respondents were asked to indicate their level of agreement with the following statements.
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Services Being Considered, by Designation
AFSP CPA EA No Designation
Amending previous tax returns 46% 45% 41% 47%
Calculating proper W-4 withholdings 28% 32% 26% 30%
Estimated tax projections 32% 45% 34% 33%
Filing a paper return 19% 18% 12% 18%
Reviewing returns done by someone else 38% 37% 35% 41%
Tax consulting 44% 53% 55% 52%
Tax examination/ representation 37% 37% 53% 33%
Tax planning 46% 55% 50% 41%
Tax preparation 48% 44% 46% 58%
Financial planning 29% 33% 32% 38%
Payroll taxes 38% 37% 41% 49%
Bookkeeping/monthly accounting 62% 59% 57% 73%
Other 10% 19% 13% 12%
Respondent & Business Profile
Average Number of Tax Returns Prepared by Your Office
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Respondent & Business Profile
Preparation TrendChange in the number of tax returns prepared over the last two years:
Factors Identified as Reasons for the Reduction in Number of Returns Prepared
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Respondent & Business Profile
Impact of Tax Law Changes on Business, by Designation
AFSP CPA EA No designation
Projected Actual Projected Actual Projected Actual Projected Actual
Revenue 2.0 2.2 2.1 2.5 2.0 2.4 2.1 2.2
Representing 2.0 2.1 2.0 2.1 2.1 2.1 2.1 2.1
Services offered 2.2 2.2 2.2 2.3 2.2 2.2 2.2 2.2
Complexity of tax 2.2 2.4 2.4 2.6 2.2 2.5 2.2 2.5
Other 2.1 2.1 2.1 2.4 2.1 2.2 2.1 2.1
Impact of Tax Law Changes on Business this Past SeasonOther impacts noted were tax planning, payroll, and client questions.
3 point scale
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Method for Pricing 1040 Tax Prep Services
Overall Average Charge for a 1040 Individual Return Regard-less of Method
Average Set Dollar Rate per Hour
$216
$126
$203
$138
Set Dollar Rate per Hour
Fee Structure: 1040 Individual Returns
1040 return (without schedules)
Schedule A Schedule C Schedule D Schedule ESchedule EIC/EITC
Form 8962
2018 $126 $126 $223 $163 $190 $126 $126
2019 $198 $131 $229 $169 $180 $122 $117
Form 1040 Schedule A Schedule C Schedule D Schedule ESchedule EIC/EITC
Form 8962
Less than 10,000 people $164 $117 $ 257 $140 $146 $117 $117
10,001 to 50,000 people $189 $126 $ 252 $149 $189 $100 $97
50,001 or more people $209 $135 $ 221 $185 $183 $138 $132
Set Dollar Rate per Hour by Client Community Size
(Average set dollar rate was multiplied by average billable hours. The results are displayed below.)
(Average set dollar rate per hour by community size was multiplied by average billable hours. The results are displayed below.)
2018
2018
2019
2019
Individual Returns
Less than 10,000 people $117
10,001 to 50,000 people $126
50,001 or more people $148
Average Set Dollar Rate per Hour, by Community Size
7% of Respondents Use this Method
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Minimum Fee Plus Cost Based on Complexity of Return
2018 2019
New client $174 $172
Returning client $162 $160
Average Set Fee per Form and Schedule
Form 1040 (with-out schedules)
Schedule A Schedule C Schedule D Schedule ESchedule EIC/EITC
Form 8962
2018 $115 $49 $87 $40 $59 $38 $28
2019 $131 $41 $84 $38 $59 $32 $22
Fee Structure: 1040 Individual Returns
Minimum Fee by Client Community Size
2018 2019
New client Returning client New client Returning client
Less than 10,000 people $139 $127 $124 $117
10,001 to 50,000 people $167 $155 $164 $156
50,001 or more people $188 $175 $196 $179
Form 1040 Schedule A Schedule C Schedule D Schedule ESchedule EIC
Form 8962
Less than 10,000 people
$113 $32 $66 $30 $45 $31 $22
10,001 to 50,000 people
$123 $39 $81 $37 $58 $31 $21
50,001 or more people
$143 $46 $92 $42 $64 $33 $23
Average Set Fee per Form and Schedule, by Client Community Size
44% of Respondents Use this Method
39% of Respondents Use this Method
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Fee Structure: 1040 Individual Returns
West East Southeast Midwest Great Plains
South Central
Rocky Mt Northeast
2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019
Form 1040 (without schedules)
$140 $148 $118 $131 $110 $135 $108 $123 $104 $135 $125 $131 $124 $146 $119 $132
Schedule A $59 $59 $53 $41 $51 $40 $40 $40 $42 $47 $52 $42 $58 $37 $49 $42
Schedule C $119 $109 $87 $83 $90 $82 $76 $77 $85 $90 $90 $83 $85 $81 $90 $88
Schedule D $55 $48 $39 $38 $43 $35 $35 $32 $35 $43 $41 $36 $42 $45 $39 $43
Schedule E $78 $75 $63 $56 $63 $61 $51 $52 $57 $59 $54 $57 $65 $61 $62 $66
Schedule EIC/EITC
$42 $31 $36 $30 $37 $31 $37 $34 $53 $42 $35 $31 $33 $29 $40 $34
Form 8962 -- $19 -- $20 -- $24 -- $22 -- $27 -- $22 -- $22 -- $23
Overall fee for federal forms
$77 $72 $61 $59 $62 $56 $54 $55 $60 $66 $60 $59 $64 $61 $68 $62
Fee plus cost based on complexity of return for new clients
$194 $195 $190 $178 $174 $166 $154 $151 $138 $97 $160 $166 $188 $204 $182 $181
Fee plus cost based on complexity of return for returning clients
$184 $169 $175 $171 $159 $159 $144 $145 $138 $86 $153 $161 $172 $174 $167 $161
Fees for Forms and Schedules, by Region
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Fee Structure: 1040 Individual Returns
Average Set Fee for Form 1040, by Designation
How Charges are Applied for Individual State Tax Preparation
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Fee Structure: Business/Fiduciary Returns
Overall Average Charge for Business/Fiduciary Return Regardless of Method
How Business/Fiduciary Returns are Charged
Form 1041 Form 1065 Form 990 Form 990-EZ Form 1120 Form 1120s
Less than 10,000 people $386 $514 $739 $257 $591 $617
10,001 to 50,000 people $426 $621 $514 $264 $783 $639
50,001 or more people $530 $762 $709 $432 $788 $741
Set Dollar Rate per Hour by Client Community Size Average set dollar rate per hour, by client community size was multiplied by average billable hours. The results are displayed below.
Average Set Dollar Rate per Hour Average set dollar rate per hour was multiplied by average billable hours. The results are displayed below.
Average Set Dollar Rate per Hour
$472
$145
$460
$169
2018
2018
2019
2019
Individual Returns
Less than 10,000 people $129
10,001 to 50,000 people $145
50,001 or more people $189
Average Set Dollar Rate per Hour, by Community Size
Form 1041 Form 1065 Form 990 Form 990-EZ Form 1120 Form 1120s
2018 $439 $578 $674 $365 $624 $653
2019 $480 $690 $648 $359 $697 $759
9% of Respondents Use this Method
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Fee Structure: Business/Fiduciary Returns
Minimum Fee Plus Cost Based on Complexity of Return
2018 2019
New client $380 $366
Returning client $369 $358
Average Set Fee per Form
Form 1041 Form 1065 Form 990 Form 990-EZ Form 1120S Form 1120
2018 $317 $387 $370 $227 $451 $496
2019 $293 $393 $332 $222 $436 $486
Form 1041 Form 1065 Form 990 Form 990-EZ Form 1120 Form 1120s
Less than 10,000 people $225 $316 $318 $200 $426 $415
10,001 to 50,000 people $297 $384 $304 $208 $474 $418
50,001 or more people $313 $431 $369 $244 $523 $461
Average Set Fee per Form by Client Community Size
2018 2019New client Returning client New client Returning client
Less than 10,000 people $304 $291 $285 $267
10,001 to 50,000 people $361 $352 $356 $347
50,001 or more people $413 $398 $401 $396
Minimum Fee by Client Community Size
61% of Respondents Use this Method
21% of Respondents Use this Method
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Fees for Forms and Schedules, by Region
Fee Structure: Business/Fiduciary Returns
West East Southeast Midwest Great Plains
South Central
Rocky Mt Northeast
2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019
Form 1041 $454 $470 $312 $280 $275 $286 $285 $260 $345 $238 $353 $212 $321 $304 $298 $316
Form 1065 $551 $496 $390 $363 $351 $409 $341 $361 $419 $356 $415 $425 $368 $371 $409 $418
Form 990 $480 $348 $319 $294 $307 $348 $349 $286 $263 $163 $437 $250 $499 $414 $421 $406
Form 990-EZ $325 $206 $200 $190 $236 $244 $212 $194 $110 $167 $239 $230 $228 $246 $212 $240
Form 1120S $601 $574 $482 $387 $379 $437 $413 $401 $434 $342 $461 $534 $390 $428 $527 $448
From 1120 $646 $670 $518 $420 $415 $505 $449 $425 $356 $332 $496 $597 $450 $439 $643 $532
Overall fee for business/fidu-ciary returns
$518 $489 $387 $327 $338 $377 $346 $333 $337 $287 $410 $397 $374 $371 $422 $394
Fee plus cost based on complexity of business returns for new clients
$471 $415 $381 $376 $392 $387 $344 $316 $316 $262 $368 $369 $392 $384 $385 $389
Fee plus cost based on complexity of returns for business returning clients
$461 $423 $370 $363 $378 $373 $325 $314 $306 $275 $362 $347 $384 $386 $375 $376
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Fee Structure: Business/Fiduciary Returns
How Business/Fiduciary State Returns are Charged
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Payment for Services
Payment Methods Accepted Frequency of Tax Preparation Fee Increases
Percent of Revenue from Automatic Payments
Fee and Payment Information
9%(such as credit card or bank account on file)
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Discounts Offered
Percentage of Gross Revenue for Other Billed Services
2018 2019
I do not offer any of the discounts
13% 14%
Free consultation for prospective clients
59% 55%
Family or friends of a tax preparer
45% 43%
Family or dependents of client
49% 46%
Students 39% 40%
Senior citizens 3% 29%
New clients 14% 13%
Returning customer 0% 12%
Advertised coupon 9% 8%
Discount for a past service error
29% 25%
Filing before a specific date 4% 3%
Charities or non-profits 12% 11%
Pro bono work 23% 22%
Vocation or affiliation (veteran, clergy, police, etc.)
10% 11%
Other 7% 7%
2018 2019
I do not charge separate fees for the tax services listed below
6% 10%
Amending previous tax returns 88% 84%
Tax examination/ representation
66% 56%
Tax planning 43% 39%
Reviewing returns done by someone else
38% 37%
Estimated tax projections
32% 28%
Calculating W-4 withholdings
16% 14%
Filing a paper return 18% 14%
Tax consulting 54% 50%
Other 5% 6%
Amount Paid for Referral
Fee and Payment Information
$37 $342018 2019
The survey was administered electronically to a 50% stratified random sample of NATP’s membership population. A total of 1,484 members completed the survey for an overall response rate of 13.3%.