Many taxpayers stress out over their tax bill in April. Some, however, also worry about how much it costs them to prepare their taxes. The average taxpayer pays close to $200 to have a tax preparer fill out their Form 1040. For taxpayers who need to file a state return and itemize, the average bill is closer to $300. For many people, it can be a struggle to find qualified tax preparers who are affordable. There are ways to get the job done affordably, however. The following tips may help.
Look for free tax preparation help
If you make $54,000 a year or less, suffer from disabilities, or speak little English, you can take advantage of the Volunteer Income Tax Assistance program to have your taxes prepared for you for free. If you are over the age of 60, the Tax Counseling for the Elderly program can help you. If you believe that you may be eligible for free help, you only need to look up a free tax preparer near you at irs.treasury.gov/freetaxprep.
Look around for affordable assistance
Every tax preparer charges differently for their services. The more experience a tax preparer has, the more they are likely to charge. You can locate affordable service doing some comparison-shopping. Comparisons can be complicated, however, by the fact that different tax preparers publish their prices differently. Some bill by the hour and others charge a flat fee per return.
The complexity of a tax return determines how much it costs to prepare it. While it can be hard to accurately tell how hard a tax return is likely to be before preparing it, you can ask for an estimate. Bring them a copy of your tax return from the previous year to show them. If there are to be no significant changes to your return, it can help the tax preparer tell you how much the work will cost you.
Look closely at the contract
Often, tax preparers look to establish long-term relationships with their clients and present them with an engagement letter that explains their terms and conditions. If your tax preparer gives you an engagement letter, you should look at it closely to find out how they charge their fees. You’ll be able to see if they charge for services such as additional copies of your return.
It’s also important to make sure that your preparer doesn’t charge you fees based on the size of your refund. It isn’t allowed for tax preparers to charge their clients to have the IRS directly deposit their refund into their accounts, either.
Request a discount
While most people don’t haggle with their tax preparer to get them to lower their fees, you can try it if you haven’t had a good year. If you’ve had a run of bad luck, you can call your tax preparer and ask them if they can lower their fees to help you out. Usually, you will get some empathy.
The closer it is to the filing deadline, the busier tax preparers get, and the more they charge for their services. If you file in February, you can catch most tax preparers when they aren’t busy. You are likely to get a low quote. It can also help to organize your receipts and other records as well as you can. The better organized you are, the less work the tax preparer has to do, and the less they charge you.
Preparing taxes is skilled, laborious work. It often turns out to be expensive. When you make use of the ideas above, however, you may be able to get your taxes done for less, or for free.