Does anyone charge extra for delinquent returns?

[schirallicpa]

Have seen a local preparer charge double when the return is a delinquent return, with explanation that you are violating the law by not filing your return on a timely basis - that apparently being the justification for increased fees.

 

what do you think of that?

[Lion EA]

I have charged more to prepare prior year returns due to having to review prior year laws, working on something that's not fresh on my mind nor anyone else's.  Or, I've taken my price for the highest priced year (taxpayer filing multiple years at once) and used it for all the years, even when a year might be simpler, for the same reason, dealing with multiple year's laws.  All that is for the clients that have brought their materials after the year, after 15 October or the next year or years later.

 

I have had years where I had their returns in what might've been a not too late time, but something like Hurricane Sandy or ear surgery or whatever delayed my preparation.  In those cases, I hold the price on multiple years the same.  Or, discount a single, almost current year.

 

It's not a punishment for filing late.  (The governments will take care of that.)  It's due to needing more of my time to review, proofread, etc., when I'm not working in the most current tax year.  Line numbers are different on forms.  Laws did or did not get extended.  Tax prep software evolves.  Fewer people around to ask that could be working on a similar issue from a prior year.  That sort of thing.

Edited February 15, 2015 by Lion EA

[mcb39]

I had three delinquents and a current last year, all from the same person.  I got a retainer up front for half and DID charge more than I normally would have, but I didn't think of it as charging more for a delinquent return.  The IRS would have prepared his SE returns from the transcripts otherwise and I was able to save him several thousand dollars.  Since we were already working with an agent, I guess I figured if I didn't get the second half, I would still be OK.  However, client was pleased with the results and paid up.  What I was charging extra for was the unnecessary waste of my time, especially when he turned out to have two years when he didn't even owe.

[Pacun]

I charge extra because I have to open a different ATX program.

[Terry D EA]

If I have to install previous software then there is an extra charge. The worst one I have had was ten plus years which had to be filed to complete an OIC. I got the retainer up front which included an additional amount for each year I had to complete. Normally, within a year or two I do increase the fee a small bit for the same reasons that have already been mentioned here.

[rfassett]

Yep! Anything out of the ordinary gets an up fee.  The fact of the matter, as Lion stated exceptionally, it takes more time than if it was in the current year.  I charge and never apologize for what I charge.

[Randall]

I don't go back more than one year. Don't want to bother with it.

[FreedomTaxed]

We don't charge extra since there's no significant extra work in filing late. Surely there's nothing extra in filing from Apr 15 to Oct 15, other than calling our extended clients to remind them to come in before the extension expires. We efile it like before. And after that, it becomes a "prior year" filing, which we always paper file. The paper filing takes a little more time, but it's folded into our base price anyway... we paper file for no extra charge, for example when your federal efile gets rejected and we have no other option to fix it.

 

Our pricing structure has driven a few preparer employees a bit batty. Naturally these are the prima donna types, and largely they get ejected from our seats soon enough since they become unmanageable. But there's a strong association between the PDs and outrage that we're "leaving money on the table". I need to keep sifting through employees until we find a few stable ones that will obey our rules and not prey upon our clients. Our prices are designed to grab market share, not scrape the last bit of financial flesh off each client.

 

(I could write an entire thread about the prima donna problem.)

[schirallicpa]

wow - I guess i wasn't considering this as financial fleshing

[joanmcq]

I charge a bit extra for having to paper file the CA returns, and everything is at the current years prices.