How much does it cost to get your taxes done?

How much does it cost to get your taxes done?

The cost to file income taxes can fall anywhere between zero dollars — as in you do your taxes yourself and file for free — and several hundred dollars, with an average cost of $273 for using a tax preparer, less if you don't itemize ($159), according to the most recent data available from the National Society of Accountants.

To judge the value correctly, though, those costs have to be weighed against the results you get, your own comfort level with going DIY, plus what could go wrong if things don't work out.

To help you weigh the pros and cons, Get Rich Slowly has compiled this guide with detailed cost comparisons.

What are your Tax Preparation Options?

Basically, there are four options. Here's the run-down:

Do it yourself

For basic tax returns, preparing it yourself is a fairly straightforward process, especially with IRS online forms and instructions. However, the more complicated your tax situation — e.g., your eligibility for itemized deductions or tax credits — the more you might benefit from the type of analysis and advice that a simple online template can't give you.

Downloadable tax-preparation software

Downloadable tax-preparation software can help walk you through the steps of more complex tax returns and perhaps present you with more options relevant to your situation than would occur to you just working through a form yourself.

Online tax-preparation services

This provides automation similar to tax-preparation software; only you enter your information online rather than onto software that you download to your computer. The difference comes down to how secure you feel having all that information online in the hands of a third party (i.e., other than you and the IRS).

A tax-preparation professional

Tax professionals can give you customized advice that can save you money this year and perhaps make you more tax-efficient in years to come. However, that advice is only as good as the qualifications of the person giving it, so you need to do some due diligence not just on the firm you use but on the person responsible for your return.

A Bit About State Tax Returns

If you live and work in Alaska, Florida, Nevada, South Dakota, Texas, Washington or Wyoming, congratulations — you don't have to worry about state taxes.

Otherwise, you'll probably have to file a state tax return. If you had income from multiple states, you may be required to file in more than one state, and this will likely cost you additional tax preparation fees for each state.

How Much Does Tax Preparation Cost?

As you can imagine, costs for the different approaches above vary widely. Even the cost for the same type of approach can differ greatly depending on your situation and which provider you use. As a result, there is no single figure that can be quoted as being indicative of the cost of each approach. Instead, we hope to show the range of costs that are out there which can give you a representative idea of what each entails.

  1. Do it yourself. It costs nothing to use the IRS resources and file your returns on its website, though some do-it-yourselfers do incur costs by buying books and other reference materials to help them understand their tax situation. However, the public library system is a good resource instead of buying these types of books.
  2. Downloadable tax preparation software. Online tax preparation software assists you in completing and submitting the necessary forms. We've been monitoring these expenses for a few years now, and there hasn't been a lot of fluctuation in price over time. The cost goes up depending on how many forms you use or how many state returns you file if, say, for example, you moved during the year.


  • The prices listed in the table below are the lowest amounts for the simplest of returns for Tax Year 2015.
  • If you are using one of these DIY services, look for a discount coupon before starting — there are plenty out there.

Downloadable Software – Lowest Advertised Cost for Tax Year 2016

Product (Company Name)


Federal 1040 Simple Price

State Price

State e-File

At Home (H&R Block ) – *



(5 Federal e-files included)



Tax Act 2015 (2nd Story Software)



(Federal e-file included)



TurboTax ® (Intuit)



(Federal e-file included)



(Except NY state.)

1. Prices shown are the lowest online advertised price as of November 8, 2016.
2. Most “free” services are limited to customers with a certain tax situation.
3. Information provided is for general guidance only. Contact provider or visit official website for specific details, as prices can change without notice.
4. * Visit individual website for special bonus offers.

Online Tax Preparation – Lowest Advertised Cost for Tax Year 2016

Product (Company Name)


Federal 1040 Simple Price

State Price

State e-File
(HBS Financial Group Ltd)
Federal Edition $0 $9.95 $0 1040EZ $14.95 (includes e-File) $17.95 $0 (CCH)
(Now – by Liberty Tax)
Free Simple Solution $0 $31.95 $0 Free Basic $0 $19.95

(Unlimited states)

$0 Free Edition $0 $29.95 $0
(by Liberty Tax)
Free $0 $31.95 $0 Free $0 (State purchase required) $29.95 $0 (Not available in every state) Basic Return Package $29.95 (Add $20.00 for e-file) $20.00 No information Federal Tax Return $29.95 $10 (if ordered with federal tax return) $0 Federal Tax Return $39.75 $36.50 (If ordered with federal tax return) $0 Standard Return $19.95 to $39.95 $9.95 to $19.95 $0
(Tax Hawk, Inc.)
Free Edition $0 $12.95 $0 H&R Block Free ™ $0 $29.99 $0 Free $0 $29.95 $0
(OLT OnLine Taxes)
Free Edition $0 $7.97-$9.95 Free if e-filing is available for your return
(AFJC Corp)
Free $0 No information No information. (all states may not be supported) Standard/Deluxe $19.95 (Standard) $29.95 (Available only with Deluxe) $0
(Rapid Filing Services LLC)
Basic Package $9.95 $9.95 (If filing with federal tax return)

$29.95 (If filing as standalone state return)

No information
(2nd Story Software)
1040EZ/A Tax Return $0 $0 $0
(Petz Enterprises, Inc. – Now Liberty Online)
EZ $19.95 $31.95 $0 Federal Tax Return $0 $14.99 $0 Free Basic Edition $0 $28.99 (Actual price determined at print or e-file and subject to change without notice) $0
Federal Free Edition $0 $0 $0
1. Prices shown are lowest online advertised price as of November 8, 2016.

2. Most “free” services are limited to customers with a certain tax situation.
3. Information provided is for general guidance only. Contact provider or visit official website for specific details, as prices can change without notice.

Cost to Professionally Prepare Other Tax Forms

Not everyone has a simple return. Here's what the NSA's most recent survey found for average tax preparation fees for more complicated forms:

  • $174 for a Form 1040 Schedule C (business)
  • $634 for a Form 1065 (partnership)
  • $817 for a Form 1120 (corporation)
  • $778 for a Form 1120S (S corporation)
  • $457 for a Form 1041 (fiduciary)
  • $688 for a Form 990 (tax exempt)
  • $68 for a Form 940 (Federal unemployment)
  • $115 for Schedule D (gains and losses)
  • $126 for Schedule E (rental)
  • $158 for Schedule F (farm)

In terms of location, the association also found the West had the most expensive returns per Census region:

They calculated the average tax preparation fee for an itemized Form 1040 with Schedule A and a state tax return. Here's how it breaks down according to the NSA:

  • $348 for the Pacific (AK, CA, HI, OR, WA)
  • $314 for the Middle Atlantic (NJ, NY, PA)
  • $268 for the South Atlantic (DE, DC, FL, GA, MD, NC, SC, VA, WV)
  • $262 for East South Central (AL, KY, MS, TN)
  • $256 for Mountain (AZ, CO, ID, MT, NV, NM, UT, WY)
  • $246 for New England (CT, ME, MA, NH, RI, VT)
  • $240 for East North Central (IL, IN, MI, OH, WI)
  • $205 for West South Central (AR, LA, OK, TX)
  • $198 for West North Central (IA, KS, MN, MO, NE, ND, SD)

Advice on Hiring a Tax Preparer

When it comes to hiring a tax preparer, in-person advice is only as good as the qualifications of the person giving it. Here are some things to think about:

  • Check your preparer's professional designations. A CPA, tax attorney, or Enrolled Agent is a plus. An enrolled agent is a tax preparer who has specific and technical expertise as defined by the U.S. Department of the Treasury. Once they become “EA”s they can represent taxpayers before all administrative levels of the IRS. According to the National Association of Enrolled Agents, you earn the designation if you've worked for five years at the IRS “in a position requiring the interpretation of the tax code” or pass an exam plus background check.
  • Make sure a preparer has a Preparer Tax Identification Number (PTIN). The IRS now requires all paid tax preparers to have a PTIN, so steer clear of a preparer who doesn't have one.
  • Research your preparer's history. Check with your local Better Business Bureau to see if there have been any complaints. Skim online reviews, remembering to take both highly negative and highly positive reviews with a grain of salt.
  • Full-time vs. part-time. Many tax preparers work seasonally, but people with complex tax situations often need advice throughout the year.
  • Ask about audit services. It helps to have assistance from your tax preparer if you are audited. Some preparers include this in the price of your return, others charge extra, and still, others don't provide this service at all. You should know whether your preparer will back up their work if you are audited, and how much it will cost you to get that assistance.
  • Ask about audit experience. Some successful IRS audit experience can be a plus; multiple instances of audits that went against the taxpayer should be a red flag.

Bottom Line on Finding a Tax Professional

Perhaps the most important decision in choosing tax preparation help is fitting the service to your needs. Depending on your situation, free advice can be a tremendous bargain — or it could be the most costly mistake you've ever made. Know your tax situation, and get appropriate help if you need it.

Above all: The IRS advises taxpayers that when using a paid preparer, never sign a blank return in advance.

Why Cost isn't the Only Consideration

You can get quotes and compare costs, but bear in mind that cost is not the only consideration. Here are some other things to think through:

  • Your time. Let's say you can save $50 by doing your taxes yourself. What you have to ask yourself is how long it will take you to complete your returns and how you value your time. You might well find that the value of your time exceeds, or at least significantly offsets, the cost of paying to have your taxes done.
  • The risk of over-paying. Tax laws change all the time, impacting credits, deductions, and different options for treating income and investments. Missing just one potentially tax-saving new wrinkle could cost you a multiple of what you would save by doing the returns yourself.
  • Possible fines for mistakes. For individual and estate tax returns during the 2014 fiscal year, the IRS assessed more than 31 million penalties, totaling just over $13 billion in value. Clearly, it is all too easy to make a very costly mistake in preparing returns.
  • Legal consequences for misleading returns. Beyond monetary penalties, particularly serious tax violations result in criminal prosecutions. When this happens, the IRS secures a conviction in the majority of cases it investigates, and nearly 80 percent of those convicted do jail time.

How to Choose a Tax Preparation Approach

Besides weighing the cost and consequences of various tax preparation methods, here are some other things you should do when choosing your approach:

  • Match the approach to your needs. Generally speaking, the more complex your tax situation, the more help you are likely to need. As your wealth and family size increase, the more you might want to use electronic tax tools or professional help — which is just as well because, as your career goes on, you are more likely to be able to afford that assistance.
  • Choose software that is up to date and well supported. If you use software, make sure it is up to date both technologically and with respect to changes in the tax code. Also, find out in advance what kind of user support is available.
  • Consider the reputation and resources of each provider. Do some online searching, and also find out what resources any tax preparation firm or technology provider has to keep abreast of tax code changes and tricky interpretations.
  • Take the long view. Often, people are so focused on meeting the April 15 filing deadline that they don't think of any possible tax issues beyond that, but there are longer-term considerations. For example, some approaches offer better record-keeping that might help you if you need to reference past returns at some point.

Also, active tax advice can help you better minimize your taxes and right-size your payroll withholding so more of your money can be earning interest in a savings account rather than being held by Uncle Sam throughout the year.

Plenty of people successfully complete their own returns every year. The important things to know before you decide to do it yourself or pay for tax preparation are how the complexity of your tax situation compares to your expertise, and what the consequences of a wrong decision could be.

What option will you select this year for how to prepare your taxes? How much do you think it will cost?

Frequently Asked Questions

What is the average cost for tax preparation?

The average cost for tax preparation can vary significantly depending on the complexity of the tax return, your location, and the tax preparer you choose. However, in general, individuals can expect to pay around $100 to $500 for professional services.

How much does a tax accountant cost?

The cost of a tax accountant typically ranges from $150 to $450 per hour, again depending on your location and the complexity of your tax situation. It's always a good idea to discuss fees upfront to avoid any surprises later on.

How much does a CPA charge to do taxes?

A Certified Public Accountant (CPA) usually charges between $100 and $400 per hour for their services. This rate can increase based on the complexity of your tax return and the CPA's experience level.

How much does H&R Block charge to file taxes?

H&R Block's fees for filing taxes can vary greatly based on the type of tax return and the specific services required. On average, customers can expect to pay around $200 to $300 for their services. Do note that prices could be higher for more complex tax situations.

More about...Taxes, Planning

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