How Much Does a CPA Cost?

CPA Cost

Last Updated September 4, 2023

An unwanted aspect of doing business is paying taxes. Nobody likes to pay taxes or prepare for it in the first place. One might wonder now, if you want your taxes done, then how much does a CPA cost will affect your business? Imagine it this way – hiring a professional CPA is the main course of action. If you do taxes on your own, and the IRS finds an error in it, you could be in hot waters. You do not want to be under the scrutinization of the auditors. So the safest means of doing your taxes is to hire a professional CPA.

But do you require a CPA or a bookkeeper? Maybe you are in need of an accountant?

Before you can ask the question “How much does a CPA cost” you need to first determine which type of accounting help you require.

How Much Does A Bookkeeper Cost?

The standard hourly rate for a bookkeeper is $16.67/hour. The bookkeeper’s job is simple in comparison to that of a CPA. they do not require formal training. Hence, the reason for the low pay. It is an affordable option for small businesses.

How Much Does An Accountant Cost?

An accountant’s job responsibility is at a higher level as compared to the bookkeeper’s. For instance, you can pay an accountant as little as $20/hour or as high as $100/hour. However, there is no standard pay for the accountant. It will vary based on the nature of the responsibility.

How Much Does A CPA Cost For A Small Business?

According to the study, conducted in 2017, by the Journal of Accountancy:

The average CPA cost was $119,000 per year, while the cost of a fresh CPA was $66,000. However a CPA with more then two decade of experience can cost $152,000 per year.

Depending on the hour of need, small businesses are mindful when it comes to hiring a professional CPA.

Following are ideal perspectives for tax preparations according to which a small business can do the proper hiring.

CPA Cost

Business Taxes

The average CPA cost will depend on your business tax returns. The more complex they are the higher the cost will be. Ask the right questions when hiring a CPA;

  • Do you do freelancing occasionally or is it your substantial income?
  • Is your business an LLC or is it an S corporation?
  • Do you run a partnership or multiple LLCs?

Depending on the nature of the business and the requirement, you can better decide how much you are willing to pay a CPA.

So if you are looking for tax preparation, clean up the books, and arrange them by making them financially presentable, then you can expect to pay your CPA a little extra.

There are a number of options to consider.


  1. Use Of Accounting/CPA Software

If you are the owner of a small business or a freelancer, you might think of doing your own taxes. Or you may think of hiring an on-site bookkeeper to do the tasks.

In case you are interested in doing the taxes on your own, you better start with the accounting software.

There are certain CPA portals that can be used to calculate the finances like Xero, My CPA Dashboard, etc. Although these options may not fit a large firm’s requirements, they will best meet the needs of a small business.

In such a case, you need to pay for the subscription plan only. So the CPA cost will be diminished.


  1. Tax Preparation Services

Sometimes a small business may not be comfortable and is smart enough to make the right choice by hiring tax preparation services. These companies are responsible to handle more complex taxes for the multi-person LLC. it is also suitable for all types of corporations.

Sometimes even the individual CPAs can do a great job too. The tax preparation company handles the deductions and credits and all other necessary input required for filing the taxes.


  1. CPA Service Providers

A CPA is a professional who has qualified for the demonstrated skills.

Hiring a CPA is usually expensive as compared to tax service preparation services. But one sole advantage of CPA is that they help you save money in the long run. So how does CPA cost? It will depend on the hourly or fixed fee rates you decide upon mutually.

Since CPAs are at the top pay scale their cost may vary from $150  to $250 per hour. In some cases, there CPA cost can go as high as $500 per hour.

Some factors that play a crucial role in the average CPA cost are;

    • Task difficulty. A simple business owner will not have to worry about higher taxes or CPA costs.
    • The business size. It will help indicate whether the CPA will be hired full-time or hourly based.
    • Locality. The cost of CPA will vary from one region to another. High commercial areas like NY city will make you cost more than Dallas.
    • Expertise. The years of experience under the CPAs belt determine the expertise. According to it, the prices may vary.

The cost of CPA for taxes for Form 1040 includes state returns also with Schedule A and Schedule C. this is only for small business firms.

The average cost of tax preparation by CPAs by form

Tax Form Average Cost Range
Form 1040 $300 – $800
Form 1040-SR $300 – $800
Form 1040-ES $150 – $400 per quarter
Form 1065 $1,000 – $3,500
Form 1120 $1,000 – $3,500
Form 1120S $1,000 – $3,500
Form 990 $500 – $2,000

Different CPA Services and Their Average Hourly Costs


Hourly Cost of Certified Public Accountant (2020 – 2021)

Full Payroll Management


Bookkeeping or QuickBooks Advisory


Management Advisory


Financial Statement Audits


Financial or Estate Planning Services


State and federal tax Return Prep


Source: NSA

How To Reduce CPA Cost?

Despite the heavy charges, you can reduce the average CPA costs proactively. Here are some things you need to remember.

CPA Cost

  1. Strong Relationship

If you work with the same CPA firm or individual all year long, they become familiar with your business workings and how you operate. They can spot the inconsistencies right away that otherwise may affect your books. and avoid rapidly rising costs, falling revenues, and fraud. Your CPA can also provide customized advice and help the business boom. This way you can develop a stronger relationship hence you can expect discounted rates.


  1. Organizing The Documents

CPAs charge extra if they need to arrange or organize the documents chronologically from the very beginning because it takes hours to organize the documents in a tax-ready format. In case of lots of deductions, donations, expenses, and so on, you need to manage the files and keep your document organized to lower the CPA cost.


  1. Consultation

Before making big financial changes, consult the hired CPA firm. A client may decide to buy a car but it may not be in his best interest due to a limited budget. A CPA can provide the list of cars that the client might be qualified for and so on.


  1. No Secrets

CPAs are the silent partners. More or less. If you withhold important information it may affect tax preparation and errors may occur. CPA determines the best way to handle the financial crisis and maintain the client’s privilege in the event of tax litigation.


CPA Fees & CPA Fee Schedule

It is one of the most frequently asked questions that are actually determined by the primary payment method that a CPA uses. The two methods are:

  • Hourly based fee
  • Fixed fee billing

CPA fees are normally determined on an hourly basis but recently the trend has shifted toward fixed-fee billing. Intuit (accounting software QuickBooks company) conducted surveys that showed that 57% of accountants bill by the hour as compared to 66% three years ago. A fixed-rate schedule is used by 50% of the accountants for their fees.

The rates of a CPA depend on the level of experience and the size of the firm. Smaller businesses pay their CPAs $30 to $50 an hour. If experience increases, the wage also increases from $40 to $80 an hour.

A CPA junior staff member costs $60 to $120 an hour. Senior staff members and supervisors ask for $100 to $200 per hour. If you become an owner, the wage becomes very hefty and increases up to $200 to $250 an hour. In major cities, and experts, the hourly rate goes up to $500. CPA owners make significantly more than non-CPA owners and the difference can range from $20 to $100 an hour.


How Much Do Accountants make an Hour?

The national hourly rate an average CPA charges his clients is slightly under $30 ($28.65) in the US. The CPAs that hold additional certifications are able to charge a slightly higher rate than a simple accountant whose median hourly rate is $20.01.

A CPA fee as compared to some of the other professional accounting fees is:

  • CPA Hourly Rate: $28.65
  • Accountant (non-CPA) hourly rate: $20.01
  • Staff Accountant hourly rate: $20.23
  • Senior Accountant hourly rate: $27.54
  • Tax Accountant hourly rate: $22.90
  • Tax Manager hourly rate: $34.60

CPAs are hired instead of standard accountants without a license even though their pays are a little higher because their education and experience provide the professionals with insight and expertise that general accountants cannot.

An accountant’s hourly pay depends greatly on the geographical location where they work in. It varies drastically from one region to another. CPAs in areas like California or New York cost much higher than in the Southeast or Midwest.

The rates of CPAs also depend on their expertise and level of experience. Their training and education have a lot to do with the wage they ask for. The minimum requirement for a licensed accountant is a bachelor’s degree, 120 college credit hours, and a passing grade on the CPA exam. In order to keep their license current, they must also maintain continuing education credits.


CPA Tax Preparation Fees

A CPA is needed most commonly for tax preparations and their wage depends on the unique tax situation and complexity.

The National Society of Accountants reported the following average CPA tax preparation fees from the previous year:

  • Form 1040 with state return and no itemized deductions – $188
  • Form 1040 with state return and Schedule A – $294
  • Form 1040 with state return, Schedule A, and Schedule C – $481

The average cost for professional tax preparation ranges from $152 to $261 depending on taxes and additional forms to prepare beyond the 1040 form.


Benefits to Hire a CPA?

A CPA can initially look like they are costing you a lot but in the long run, it pays off. Hiring a CPA can help in preparing financial statements that are needed for loans and outside investments and identify any tax-saving opportunities, while also providing necessary advice for your small businesses that can help you grow.

It is not necessary that a certified CPA be hired. In case you own a small business and need help with business transactions, and straightforward tax returns, you can also hire accountants or bookkeepers that can provide you with additional expertise. If you have some experience with software, and a basic understanding of tax laws, you can use accounting software to prepare your tax returns yourself.

Some of the situations where hiring a CPA is worth it are:


  1. Auditing of Financial Statements

Professional CPAs are needed for auditing financial statements and only they can issue an auditor’s report and audited financial statements.


  1. Making your Company Public

If you plan on making your company public in the US, you are required to issue financial statements based on generally accepted accounting principles (GAAP). These are a number of principles that are designed for companies to measure and report their financial performance which can also help investors analyze and compare each company’s financial statements with the other companies and organizations. These companies are also required to follow all the regulatory requirements and also have documented internal controls. Hiring a CPA can help in complying with all the requirements making you ready for an eventual initial public offering (IPO).


  1. You have a Complex Tax Situation

Hiring a CPA can help you with any tax complications, tax returns, and claim tax credits ensuring that your tax return is filed properly.


  1. You have IRS Problems

CPAs and related professionals are the only ones that can represent taxpayers in a tax dispute or an IRS audit so it is worth hiring a CPA to avoid such problems.


  1. Need for In-Depth Advice

CPAs who have been working with you for a while can provide consulting services and advice that are customized according to your needs and extend beyond basic financial issues.


  1. Maximizing deductions and credits

Tax professionals are knowledgeable about tax laws and regulations and can help you identify deductions and credits that you may not be aware of, which can help you reduce your tax liability and maximize your refund.


  1. Avoiding mistakes

Tax laws and regulations can be complex and confusing, and making errors on your tax return can result in penalties and interest charges. Tax professionals can help you avoid these mistakes and ensure that your tax return is accurate and complete.


  1. Saving time and reducing stress

Preparing your own taxes can be time-consuming and stressful, especially if you have a complicated tax situation. Hiring a tax professional can save you time and reduce stress by taking care of the tax preparation process for you.


  1. Dealing with IRS issues

If you have any issues with the IRS, such as an audit or a tax debt, a tax professional can help you navigate the process and resolve the issue.

Working with a CPA has a few other benefits:

Working with a Certified Public Accountant (CPA) has several other benefits, including:

  1. Expertise and knowledge: CPAs have a deep understanding of accounting and tax laws and regulations, as well as financial planning and business strategy. They can provide valuable insights and guidance that can help you make informed decisions and achieve your financial goals.
  2. Credibility and trust: CPAs are highly respected professionals who are held to strict ethical standards and must maintain their licensure through ongoing education and training. Working with a CPA can provide credibility and build trust with stakeholders, such as investors, lenders, and regulators.
  3. Comprehensive services: CPAs can provide a range of services beyond tax preparation, such as audit and assurance, financial planning, business valuation, and consulting. This can help you streamline your financial management and ensure that all aspects of your finances are integrated and aligned with your goals.
  4. Long-term partnership: Working with a CPA can be a long-term partnership that evolves over time as your financial situation and goals change. A CPA can provide ongoing advice and support that can help you navigate the complexities of the financial landscape and make informed decisions about your finances.

Overall, working with a CPA can provide a wide range of benefits that can help you achieve your financial goals, build credibility and trust, and streamline your financial management.

Why My Count Solutions is the Best Choice to Hire CPA for Tax Solutions

My Count Solutions is the best choice for bookkeeping services and auditing representation that can bring tax returns home for your business. It also provides financial consultation for small businesses that can help your business run smoothly. It can help you keep your books organized and the team of bookkeepers also keeps rotating keeping the business efficient and organized. It helps you remain tension-free by getting your books ready before the tax season blooms.

It is the most trusted domain for tax preparations. My Count Solutions organizes tax reports in order to help ease tax complexities and improve business performances, whether it is individual tax preparation or a large business firm.

My Count Solutions have a team of experts that not only manage the books but also prepare your receipts, and invoices and also sync your accounts for straight record keeping. It can help your businesses arrange and file all your taxes providing auditing guidance for improving your operations. It helps improve your customer relations and manage your risks effectively and provide an effective and mature profitable audit representation.

The capable experts of CPAs at My Count Solutions offer complete and reliable services that keep your books simple, organized, and efficient. It provides flexible online services that take care of all your business’s needs. One of the best services is real-time payments to avoid the risk of late or missed payrolls. It helps you handle finances in a cost-efficient manner and build resilience by increasing payroll accuracy. My Count Solutions provides the best services that strengthen the backbone of any business by providing auditing, payroll, and tax preparation services.

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