How Much Does Tax Preparation for Small Business Cost?
Let’s face it, tax preparation is more complex than ever, not least because of the changes to the 2018 tax code. In fact, a study by the National Small Business Association (NBSA) shows that it’s a significant burden on small business owners, in terms of both financial and administrative costs.
It’s easy to see why those who did their own taxes in the past, or used a well-known tax prep service without looking at all the options, are now shopping around for a better solution.
There are three main types of price structure that you’ll encounter when researching tax preparation services. Within each type, you’ll find a range of rates based on the expertise level of the provider.
You may use an accountant for more than just preparing your annual tax return. The advantage here is that your accountant is already familiar with your books, and ideally has kept you in a tax-ready posture throughout the year so that the extra work of preparing a return is minimized. Typical rates are:
• Bookkeeper — $30 to $90 per hour
• CPA — $150 to $450 per hour
Per Engagement Fee
You choose to hire an accountant for the specific task of preparing your small business income tax return.
• Tax return (unincorporated) — $200 to $500
• Tax return (incorporated) — $800 to $1,800
Monthly Flat Fee
This option is growing in popularity with small businesses. The standard amount would cover the services you agree on, including weekly bookkeeping, P&L statements, payroll filing and annual tax preparation. It gives you the same benefits of a traditional accounting service, yet can cost less than half what you would pay in hourly fees. That’s why Xendoo offers this pricing structure to our clients.
• Inclusive services — $95 to $2,500 per month
Other Factors in Hiring a Tax Preparation Accountant
It takes more than pricing to get a really good value from your tax accounting service. Consider your needs and quality standards:
• Specialization.Look for a firm that has experience in your industry and the size of your business. Their insights can save you time and money.
• Credentials.Check into certifications, education, training and years in practice.
• Processor vs. Advisor.A processor type of accounting firm simply works with the numbers you provide. An advisor helps you plan capital expenditures and operating costs to minimize taxes.
• Service level.Will your accountant respond immediately when you call, or get back to you days later? Are there email or app communication options?
Xendoo specializes in providing tax preparation and other accounting services to small businesses. Understanding the small business owner’s need for affordable pricing, we utilize state-of-the-art technology to minimize costs while providing first class service.
If you’d like to learn more about our pricing and what you get for your money, please contact us today.