Raising Your Rates for Next Tax Season?

[ETax847]

Are planning on raising your prep fees for the upcoming filing season, and if so, by what amount? I know we are all in different markets so a % increase may be more helpful.

[Jack from Ohio]

Absolutely!!  All the seminars, training, and new laws we have to learn, that are not caused by my actions, but yet I must know... YES.

[Margaret CPA in OH]

It's been 2 years since my last raise of just 4.5% but think it's really justified this year.  I had to get a new computer with Win10, upgrade scanner and fax software to work with it and the tax software inched up another 10%.  I bill by time but think I will add a technology fee of $25 across the board as an incremental amount per hour for my small client list won't do it.  And I WILL explain in my cover letter.  I think everyone is familiar with this major change in OS requirement.  We shall see who decides I'm no longer worth it.  I kind of like natural attrition, actually!

[Lee B]

My fee increases last year were fairly stiff, so this year I will either leave fees unchanged or only small increases.

[Randall]

I don't have a set policy of raising everyone across the board or a set percentage.  I look at each client.  If the return is about the same (time wise), I'll raise every 2 or 3 years, $25 or maybe more.  If the difficulty increases, I'll raise each year and more in dollars depending on the circumstances.

 

[BulldogTom]

Not this year, at least on the 1040.   The 1120 and 1065 are going up.

Tom
Modesto, CA

[Lion EA]

I didn't raise prices nearly enough last year, so I'm raising again this year.

[Catherine]

As always, we each do what is right for our client base, prior actions, and general practice considerations.  What is also probably true is that most of us under-charge for our work.  I am always gob-smacked when a new client comes in and I see what they paid the prior year.  One new 2018 client, whom we charged about $500, showed prior year bill for the same difficulty return (and it was not done right!) over $1,500!

[Edsel]

I calculate my overhead costs (yes they are available because I have to do a Sch C on myself), and I measure how much they go up.  Then I raise my rates by 2/3 of the percentage increase in overhead.  Example:  if they go up 6%, I'll raise by 4%.  This may sound like I'm losing money, but so much of my overhead is fixed cost, so I will come out.

One thing I added a few years ago was a flat fee of an additional $25 (over and above the cost of prep) for an EIC.  This is cheap because the EIC usually results in many many $ if they qualify.  But now I add $25 for ANY requirement to fill out an 8867.  They keep expanding the reasons to file the 8867 so I may add even more.

I've got a bad attitude about the 8867 format, because by any sane definition, it is an audit document.