Introduction. We endeavor to offer high quality tax preparation services for a modest price based almost exclusively on three factors—complexity, time commitment, and risk.
- Complexity refers to the amount of various forms and the difficulty of preparing them in our tax software. While some forms are simple, others are inherently complicated and require a higher level of skill to properly enter the information.
- Time Commitment refers to the fact that client preparation can wildly differ. Two clients may both have a similar rental property, but if the one comes in with a Schedule E filled out based on their excellent process of internal account, and the other brings a shoebox full of receipts and says “here’s my rental information,” those scenarios will require a very different time commitment. By charging a premium for doing a client’s bookkeeping for them, we reward those who are well prepared and have documentation for their forms.
- Risk plays into this as well, as we may take on differing amounts of risk in preparing each particular return. Some returns are very straightforward and are basically form-to-software entry, but many returns involve uncertain tax positions and require us to make calculated judgement calls. Other returns require us to certify information to be used in various schedules. Both the taxpayer(s) and the tax preparer sign the form that is sent to the IRS, and in submitting a return, we are stating that we believe the return is materially correct based on the information provided from our client.
Free tax preparation. According to the IRS Free File site,
“…you can electronically prepare and file your federal individual income tax return for free using tax preparation and filing software. IRS Free File lets you prepare and file your federal income tax online using guided tax preparation, at an IRS partner site or Free File Fillable Forms. It’s safe, easy and no cost to you for a federal return…”
However, our clients’ experiences have been mixed when using IRS Free File. It’s not the IRS who provides the software—they partner with various commercially available tax preparation software, including TaxSlayer Simply Free, H&R Block Free Online, Credit Karma, and others. TurboTax withdrew from the Free File program prior to the 2021 tax season. A taxpayer would access the free software via the IRS website, and would not have an account directly with that provider.
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