How Much Does a CPA Charge to File Business Taxes? | Small Business Accounting Advice

Sean Lund-Brown

Filing your own taxes is rarely a good idea in the business world. There are so many variables involved, schedules and forms to fill out, deductions to factor in—it’s exhausting just thinking about it. Businesses should consider having an accountant on retainer just in case they need their services at any point, of course, but if you don’t have one, don’t sweat it. 

You can find a CPA, or Certified Public Accountant, to handle your business taxes specifically and allow them to take care of the stress for you. You’ll want to take the time to see what your options are and make sure that you find an accountant that is licensed to work in your state of incorporation or business operation. They should be familiar with local and federal tax laws, as well as how to ensure that your business gets the maximum deductions to minimize what you pay to the IRS every year. 

There is no single cost to having a CPA prepare and file business taxes. There are far too many variables involved. Speaking of which, consider some of the most popular factors involved below. 

Size matters

One consideration that will impact what you pay for tax filing with a CPA is the size of your business, or more importantly the size of your profits, assets, and other business values. The bigger a business, the more complex its taxes will become over the years. Therefore, while a small business might only spend a few hundred dollars on tax prep starting out, that number could increase to $1,000 or more, depending on the nature of the taxes and how complex they become. 

Forms and schedules

Some CPAs will also charge their rates based on which forms and/or schedules they have to complete. This is because that will usually determine how much labor is involved and how much time it will take to do the job. It could also mean that there is more work on their part coming up with paperwork, providing documentation, and so forth. If you choose an accountant that charges based on the types of forms used, this will be what you want to keep in mind. 

Hourly rates

Another way that CPAs charge for their services is based on an hourly rate. This is the most common for complex business taxes, and the average going rate is around $180 per hour for tax services or the filing of Federal and/or State tax returns. Some CPAs may have fixed fees for taxes, but hourly billing is common, so it’s important to know what both entail so that you can find the right person for the job. Some CPAs may also charge hourly rates for anything above and beyond their “standard” tax service, so familiarize yourself with their policies before choosing your accountant. 

Additional charges

Some CPAs will also have additional fees that come with their tax filing services, such as a retainer for IRS audit assistance, a retainer for tax prep in past years, extension filing fees, and so forth. There are also premium costs if you want to expedite your returns and you may be charged an additional fee if your files are incomplete or disorganized. After all, the more work they have to do to complete your taxes, the more time and effort it will take. They will charge accordingly. 

Should I file my own business taxes?

When seeing these rates and variables, some people worry that the cost of filing business taxes will add up far too quickly and become cost-prohibitive for them. Thus, they may discuss the idea of filing their own taxes. After all, there is plenty of great tax software out there today that helps individuals and companies take care of all their tax preparation needs. These services and platforms have their own prices, but they are usually a fraction of what you would spend on a licensed CPA doing your taxes for your business. 

Of course, that also brings with it the risk that you could do something wrong in filing your own taxes. That’s not going to do you any good. Even if you save a fortune filing yourself, how much will it cost you in IRS penalties when there is a seemingly “simple” mistake that you didn’t even know to think about? It’s best not to waste your energy and just invest in the best people for the job. 

Manage the costs with modern accounting tools 

When you are prepared ahead of time, you can save a lot of money on your business tax filing costs. For example, you won’t have to worry about fees for disorganized files or tracking down missing paperwork. You can also find a host of small business accounting tools that can help you keep tabs on your finances throughout the year so that when it comes to tax time, everything is easy. 

Besides, an accountant should be seen as an investment for your business. The money that you’re spending could come back to benefit you in the way of additional tax breaks or reduced IRS penalties because your taxes are done properly. With the right tools and knowledge, your business tax costs don’t have to break the bank, no matter who you decide to partner with. 

Speaking of partners, consider how Smith.ai can step up your admin game and more

At Smith.ai, we know how important it is to keep your business moving. You can’t let things like tax time bog you down. Fortunately, we also have dedicated tools and a team of virtual receptionists that are available 24 hours a day, seven days a week to assist with all kinds of admin and communication needs, from scheduling and lead intake to 24/7 phone answering, live website chat, and so much more. We can even assist with payment collection and other admin solutions and offer a strategy to manage all of it with ease. 

To learn more, schedule a consultation to discuss how the virtual receptionists at Smith.ai can streamline your administrative tasks and communications. You can also reach us at hello@smith.ai or (650) 727-6484. 

Sean Lund-Brown

Sean Lund-Brown is a current Marketing Assistant for Smith.ai. A graduate from Metropolitan State University of Denver, Sean graduated with a BA in Music and an individualized degree in Teaching Vocal Pedagogy.

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