So just how much do people in the Bay Area pay to have their taxes done?
This question was posted in my Feb. 24 column, and many readers responded. I'll share some e-mailed responses in the hope it will help readers gauge whether they're paying a fair price.
-- Kris M. uses a CPA firm in Vacaville and pays $500 to 550 for federal and state returns including Schedule A (itemized deductions) and schedules for rental and investment income.
-- Robert H. of Danville pays $598 for a 1040 with schedules A, C (for a small consulting business), M (Making Work Pay credit) SE (self-employment tax) and forms 2106 (employee business expense), 4562 (depreciation/amortization), 8283 (non-cash charitable contributions) and 8829 (business use of home).
-- Steve L. of San Ramon paid $690 for an individual return with 12 federal forms prepared by a CPA working out of her home office in Danville, plus $300 to prepare a fairly simple trust return.
-- Mike Z. says, "My partner and I were charged $1,100 for two returns by a large CPA firm. It was fairly simple, with two rental properties and some stocks and bonds."
-- Marc F. writes, "I've been going to the same CPA for 20 years. She charges by the form. I usually have a W-2, schedule C, schedule A and a K-1 (for partnership income). I pay about $500. The main advantage of going to the same person year by year is that she easily keeps track of all my depreciation schedules, she's experienced with preparing returns for academics who often have multiple sources of income, and she's there to represent me if I ever get audited, which hasn't happened yet."
-- Bruce F. uses a Dublin CPA. "For a $425 fee, my return includes: Form 1040, Schedules A, B, D (capital gains), E (supplemental income), M and Forms 1116 (foreign tax credit), 4562, 4952 (investment interest expense deduction), 8582 (passive activity loss limitations), alternative minimum (AMT) tax" and a California tax return with several additional forms. I'm sure it helps that I am incredibly well-organized. My return involves two rental properties and a variety of stocks in addition to my standard W-2."
-- Patricia L. says, "We paid $1,275 for preparation of our 2009 tax return by a CPA and here's what we got: 1040, Schedules A, B and E; Forms 1116, 6251 (alternative minimum tax), 8801, 8606 (nondeductible IRAs), 8582 (passive activity loss limitations), 4952, 4562 and 2010 estimated tax worksheet (federal and California).
"Every year our federal and state returns are bound into a small tome about an inch thick. It appears that AMT contributes to this complexity and waste of paper because many of the schedules and forms are also required to be computed again under AMT rules."
-- Charles C. of Vallejo says, "I have been using the same CPA firm in Fairfield for about 15 years. My returns are not very complicated. They include a 1040 with schedules A and B and a California return with Form CA (adjustments).
"The fee is $275."
-- Tom M. writes, "I'm a self-employed real estate appraiser, and my wife gets Social Security, a small pension, small annuity and interest income. Our tax man is an independent CPA, has been doing my taxes for 30-plus years and generally increases our charge $50 every year or so. This year the charge is $775."
-- Dan F. is an independent consultant living in Washington, but last year all of his work was in California. "Talk about 'insanely complicated,' take a look at CA 540NR (the California non-resident tax return) sometime," he writes. "Anyway, my taxes were prepared at H&R Block by the office manager, who is a year-round employee. I needed federal schedules A, C, D, M and SE (self-employment tax), along with their CA equivalents where they exist. I was charged about $580, which I thought was fair.
This question was posted in my Feb. 24 column, and many readers responded. I'll share some e-mailed responses in the hope it will help readers gauge whether they're paying a fair price.
-- Kris M. uses a CPA firm in Vacaville and pays $500 to 550 for federal and state returns including Schedule A (itemized deductions) and schedules for rental and investment income.
-- Robert H. of Danville pays $598 for a 1040 with schedules A, C (for a small consulting business), M (Making Work Pay credit) SE (self-employment tax) and forms 2106 (employee business expense), 4562 (depreciation/amortization), 8283 (non-cash charitable contributions) and 8829 (business use of home).
-- Steve L. of San Ramon paid $690 for an individual return with 12 federal forms prepared by a CPA working out of her home office in Danville, plus $300 to prepare a fairly simple trust return.
-- Mike Z. says, "My partner and I were charged $1,100 for two returns by a large CPA firm. It was fairly simple, with two rental properties and some stocks and bonds."
-- Marc F. writes, "I've been going to the same CPA for 20 years. She charges by the form. I usually have a W-2, schedule C, schedule A and a K-1 (for partnership income). I pay about $500. The main advantage of going to the same person year by year is that she easily keeps track of all my depreciation schedules, she's experienced with preparing returns for academics who often have multiple sources of income, and she's there to represent me if I ever get audited, which hasn't happened yet."
-- Bruce F. uses a Dublin CPA. "For a $425 fee, my return includes: Form 1040, Schedules A, B, D (capital gains), E (supplemental income), M and Forms 1116 (foreign tax credit), 4562, 4952 (investment interest expense deduction), 8582 (passive activity loss limitations), alternative minimum (AMT) tax" and a California tax return with several additional forms. I'm sure it helps that I am incredibly well-organized. My return involves two rental properties and a variety of stocks in addition to my standard W-2."
-- Patricia L. says, "We paid $1,275 for preparation of our 2009 tax return by a CPA and here's what we got: 1040, Schedules A, B and E; Forms 1116, 6251 (alternative minimum tax), 8801, 8606 (nondeductible IRAs), 8582 (passive activity loss limitations), 4952, 4562 and 2010 estimated tax worksheet (federal and California).
"Every year our federal and state returns are bound into a small tome about an inch thick. It appears that AMT contributes to this complexity and waste of paper because many of the schedules and forms are also required to be computed again under AMT rules."
-- Charles C. of Vallejo says, "I have been using the same CPA firm in Fairfield for about 15 years. My returns are not very complicated. They include a 1040 with schedules A and B and a California return with Form CA (adjustments).
"The fee is $275."
-- Tom M. writes, "I'm a self-employed real estate appraiser, and my wife gets Social Security, a small pension, small annuity and interest income. Our tax man is an independent CPA, has been doing my taxes for 30-plus years and generally increases our charge $50 every year or so. This year the charge is $775."
-- Dan F. is an independent consultant living in Washington, but last year all of his work was in California. "Talk about 'insanely complicated,' take a look at CA 540NR (the California non-resident tax return) sometime," he writes. "Anyway, my taxes were prepared at H&R Block by the office manager, who is a year-round employee. I needed federal schedules A, C, D, M and SE (self-employment tax), along with their CA equivalents where they exist. I was charged about $580, which I thought was fair.
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