The Average Cost of Tax Preparation by CPA
Preparing for tax season often requires organizing complex information, such as making sure multiple income sources are accounted for, itemized deduction opportunities aren't missed, and tax compliance with the ever-changing laws are adhered to. Because tax planning and even basic tax filing can become so complicated, its common to ask yourself, how much does it cost for tax preparation services from a professional?
At C.E. Thorn, CPA, PLLC, our Raleigh CPAs are exploring the primary factors that go into the average cost of tax preparation by CPAs in 2025.
Table of Contents
What Are Tax Preparation Fees?
Before we dive into the average cost of tax preparation by CPAs, lets define tax prep fees. Tax preparation fees are charges for services to prepare and file your tax return, whether through online tax preparation services or working directly with a tax professional like a Certified Public Accountant (CPA).
Online Tax Preparation vs Professional Tax Preparation Fees
Online tax software may be appealing for its convenience and lower upfront costs, usually in the range of $50-$150, especially for individuals with very simple returns. However, tax preparation software and online platforms are limited to what you enter and lack the ability to analyze your unique financial situation for strategic tax savings.
In contrast, working with an experienced CPA offers a far more comprehensive service. A professional offering tax planning services doesn't just fill out forms—they help you identify eligible deductions and credits, ensure compliance with current tax laws, offer guidance on complex filings (such as S corporation or multi-property returns), and provide long-term tax planning advice.
Their services, which can range anywhere between $200-$1500, are especially valuable for small business owners, investors, freelancers, and anyone with a tax return that goes beyond basic W-2 income.
Average Price to File Taxes in 2025
According to a recent survey from the National Society of Accountants (NSA), the average tax preparation fees for 2025 vary based on the complexity of the return and the preparer’s qualifications.
Below is a breakdown of costs by form, reflecting common tax preparer charges:
| Tax Form | Average Cost per Form | Average Hourly Fees |
| Form 940 (Federal Unemployment) | $78 | $111.95 |
| Schedule C (Self-Employment) | $192 | $149.95 |
| Schedule E (Rental) | $145 | $149.52 |
| Schedule EIC (Earned Income Credit) | $65 | $146.70 |
| Form 1040 (Non-Itemized) | $220 | $153.74 |
| Form 1040 (Itemized) | $323 | $161.34 |
| Form 709 (Gift Tax) | $421 | $178.29 |
| Form 1041 (Fiduciary) | $576 | $172.66 |
| Form 1065 (Partnership) | $733 | $177.29 |
| Form 990 (Exempt Organization) | $735 | $171.48 |
| Form 1120-S (S Corporation) | $903 | $179.81 |
| Form 1120 (Corporation) | $913 | $181.57 |
| Form 706 (Estate) | $1,289 | $188.63 |
For small businesses, the S corp tax preparation cost or partnership filings (Form 1065) can be higher due to their complexity.
Average Cost for Tax Preparation by CPAs in 2025 by Billing Method
When evaluating tax preparation services, one of the most important factors to consider is how your tax preparer charges for their work. Whether you're an individual filing a standard 1040 or a small business managing more complex forms like corporate or business tax returns, understanding the typical fee structure can help you budget effectively and avoid surprises during tax season. Here is the average cost of tax preparation by CPAs based on fee structure.
Per Form Billing
This is the most common model among CPAs and works well for small businesses and individuals with specific filing requirements. Each form (such as Schedule C for self-employment income or Form 1120S for S corporations) has its own set fee, making costs more transparent.
For example, the average cost of tax preparation by CPAs for a basic Form 1040 without itemized deductions is around $220, while business tax preparation fees can exceed $900 depending on the return. This method is ideal for those with multiple income sources or more complex filings, such as rental income or capital gains.
Fixed Fee Billing
A flat fee model offers predictability, especially for those with consistent annual filing needs. This method allows clients to know the total cost of tax preparation upfront, regardless of how much time it takes.
Fixed rates are popular for basic tax filing needs or when using CPAs for both personal and business income returns. Many accounting services also offer bundled tax planning services as part of a fixed annual contract, which can help minimize tax liabilities over time.
Hourly Billing
Some CPAs and tax advisors charge by the hour, with the average cost of tax preparation by CPAs is around $180 per hour. This model is typically reserved for more complex tax situations that require in-depth consultation, such as estate planning, capital gains management, or multi-state business tax issues.
If you’re filing corporate tax returns, need support with IRS audits, or require strategic tax advice, hourly billing may offer the flexibility to pay only for the time needed. However, it’s important to clarify expectations upfront to avoid surprises during a busy tax season.
Fixed and Hourly Combined
Some tax professionals use a hybrid approach—charging a base flat fee for standard filing and an hourly rate for any work beyond that scope. This flexible structure allows for accurate base pricing with room for adjustments based on workload.
It’s a common billing method for professional tax preparation firms working with clients who have itemized deductions, investment income, or returns that may vary in complexity from year to year.
Factors Influencing Cost to Get Taxes Done
Several key factors determine tax preparer rates and the overall cost of filing taxes, from the complexity of your return to who prepares it. Understanding these elements can help you better anticipate your total tax preparation fees for 2025.
Pros of Making Quarterly Estimated Tax Payments
Paying quarterly estimated taxes has several benefits, especially for self-employed individuals, business owners, and those with significant non-wage income.
Complexity of Your Tax Situation
The complexity of your tax return significantly impacts the price to file taxes. Simple returns, like a non-itemized Form 1040, cost less, while complex situations—such as rental properties, S corporations, or passive investments—require more time and expertise. Life events like marriage, home purchases, or receiving an inheritance can also increase the cost to file a tax return.
Qualifications of the Tax Preparer
Quarterly payments help break down your tax liability into manageable chunks, making it easier to plan and manage your finances. Business owners and freelancers can more easily incorporate these payments into their regular cash flow cycle, instead of having to come up with a lump sum at tax time.
Organization of Your Records
Well-organized financial records reduce the time a CPA spends, lowering the cost of filing taxes. Disorganized or incomplete files may incur additional fees, averaging $166, as preparers must sort through records to ensure accuracy.
Special Situations
Certain transactions, like IRS-designated “listed transactions,” require additional forms and expertise, increasing tax preparation rates. Other scenarios, such as late filings ($56 for extensions) or IRS audits ($902 retainer), may also raise costs.
Tax Preparation Costs for Small Businesses
Small businesses face unique tax needs, often requiring forms like Schedule C, Form 1065, or Form 1120-S. The cost to file business taxes typically ranges from $500 to $1,500, depending on the entity type and volume of transactions. For example, the average cost of 990 preparation for nonprofits is $735, while S corp tax preparation costs average $903 per form.
Deducting Tax Preparation Fees
Self-employed individuals, including sole proprietors, landlords, or farmers filing Schedule C, E, or F, can deduct business-related tax preparation fees. However, since the 2018 Tax Cuts and Jobs Act, personal tax preparation costs are no longer deductible for most taxpayers unless tied to business activities. Consult a CPA to determine the deductible portion of your tax prep fee.
How to Choose the Right Tax Preparation Service
The average cost of tax preparation by CPAs largely depends on your specific tax needs and your CPAs fee structure. Choosing the right tax preparation service depends on your financial situation, filing needs, and how much support you want throughout the process. Here's what to consider before making your decision.
Pros of Making Quarterly Estimated Tax Payments
Paying quarterly estimated taxes has several benefits, especially for self-employed individuals, business owners, and those with significant non-wage income.
Assess Your Tax Needs
Evaluate the complexity of your return. Simple returns may suit online software, which can cost as little as $50–$150. However, for intricate situations like business ownership or investments, CPA tax preparation costs ensure accuracy and savings, despite higher tax filing fees.
Compare Costs and Services
Request quotes from multiple tax preparers, comparing their rates and billing methods. Ensure they have experience with your specific tax forms, such as Form 1041 or Form 1120-S, to avoid costly mistakes.
Work with a Trusted CPA
For personalized service, consider a CPA firm like C.E. Thorn, CPA, PLLC. Our team of Raleigh small business accountants specialize in small business and complex individual tax preparation, offering year-round support to streamline your tax process and reduce costs.
Special Situations
Certain transactions, like IRS-designated “listed transactions,” require additional forms and expertise, increasing tax preparation rates. Other scenarios, such as late filings ($56 for extensions) or IRS audits ($902 retainer), may also raise costs.
Tax Preparation Cost FAQs
What is the average cost of tax preparation for individual filing status?
The average cost for a basic Form 1040 without itemized deductions is around $220; with itemized deductions, it rises to about $323.
How much does it cost to file business taxes with a CPA?
The average cost of tax preparation by CPAs typically starts at $700 to $1,300, depending on the type of business entity and return complexity. Bear in mind there may be a flat fee in addition to a fee based on tax complexity.
What is the average S Corp tax preparation cost?
The average cost of tax preparation by CPAs to prepare and file Form 1120S for an S Corporation is approximately $903.
How much are 1041 tax preparation fees with a tax professional?
The average average cost of tax preparation by CPAs for preparing a Form 1041 (estate or trust return) is about $576.
What is the average cost of 990 preparation with a CPA?
The average cost of tax preparation by CPAs to prepare Form 990 for exempt organizations is around $735.
Can I deduct my tax preparation fees?
Self-employed individuals filing Schedule C, E, or F are eligible for small business deductions for business-related tax prep fees. Personal tax preparation costs are generally not deductible since 2018.
What tax documents do I need during my consultation with a CPA?
Bring your prior year’s tax return, W-2s, 1099s, receipts for deductions or expenses, investment statements, and any relevant business income or expense records.
How will a CPA handle my multiple income streams for filing my federal income tax?
A CPA will review each income source—such as wages, business income, rental income, or investments—and apply the proper forms and tax strategies to ensure accurate reporting and compliance.
Do CPAs help with strategic tax planning throughout the year?
Yes, many CPAs offer year-round strategic tax planning to help minimize liabilities, maximize deductions, and align tax strategies with your financial goals.
Contact Our Raleigh CPA for Business Tax Preparation Services
If you're looking for support this tax season, reach out to our Raleigh CPAs from C.E. Thorn, CPA, PLLC. We work with business owners from a variety of industries and across the greater Raleigh area. To learn more, call us at 919-420-0092 or fill out the form below.
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