Hiring a CPA: How Much Does It Cost to Have a CPA Do Your Taxes?

Small business owners spend about 41 hours doing taxes every year.

In the first quarter of every year, you have to spend time creating W-2 forms, 1099-MISCs, and file your last quarterly estimated taxes. You then have to tally your expenses and income for the year. No wonder why it can take almost two entire days to do.

You could save that time and hire a CPA instead of doing taxes yourself.

How much does it cost to have a CPA do your taxes?

Keep reading to find out.

How Does a CPA Charge for Tax Preparation?

There are several ways a CPA can charge for your tax preparation. You could pay a CPA by the hour, by the number of forms prepared, or a flat fee for your tax preparation.

Some CPAs will have complete pricing information posted on their website for your convenience. 

Flat Fee Service

CPAs that charge a flat fee are more commonly found doing simple tax returns, such as a 1040 EZ. This is mostly for people who are W-2 employees, not small business owners.

Another instance where a CPA charges a flat fee is for a consultation. This is to be used if you have specific tax questions during the year. 

Charge by Forms

One of the more common pricing structures is for a CPA to charge by the types of forms they have to prepare to complete your tax return. For example, an S-Corp Form 1120-S will cost $500, a 1040 will cost $125, and a Schedule C will cost $100.

This type of pricing structure works because you’re paying for the expertise to have someone complete these complicated forms. It’s also fair to the CPA because they’re investing a lot of time keeping up with the latest tax laws to make sure they’re filing your forms correctly.

Charge by the Hour

CPAs will also charge clients an hourly rate to prepare tax returns. There’s a broad hourly range as to what they’ll charge, but you should expect to pay between $100 – $250 per hour.

How much you pay will depend on how complex your tax return is. A CPA may give you a range, but the final amount depends on too many factors, such as location and if there are several CPAs at the firm.

Is It Worth It to Hire a CPA?

You may not want to part with several hundred dollars because you can do your taxes yourself. Before you start getting your tax information together, you need to examine why you want to hire a CPA. These benefits will tell you how a CPA is worth every penny.

Save Time

Do you know what you could do with 41 hours? You could go to the beach, you could get new clients, market your business, or anything else you could imagine.

Why do choose to do your taxes? The opportunity costs are great when you try to do them on your own.

Limit Your Liabilities

The IRS tells business owners to have a CPA do their taxes. The reason why is because business owners aren’t experts in tax law. This year, there are a host of changes to business taxes because of COVID-19.

You could make a mistake that costs your business in penalties and interest. A CPA will be able to eliminate those mistakes, which will reduce your liability exposure.

They Know How to Handle the IRS

Let’s say that the worst-case scenario happens and you get audited, or the IRS asks for more information about your tax return. How you respond to that request could clear the issue or get you into trouble.

A CPA frequently communicates with the IRS and they know how to handle these situations. They’ll be able to respond correctly and get any issues cleared up.

How to Hire a Great CPA

Before you hire a CPA, you want to get clear on your financial goals. There are Certified Public Accountants that specialize in different areas. Some may specialize in small businesses or self-employed tax returns.

Others see themselves as a CPA tax adviser, working with people who want to build wealth and implement smart tax strategies in order to do so.

Once you understand your goals, it’s much easier to narrow down the broad field of CPAs. You can start to find the right CPA by asking for recommendations from friends and colleagues.

When you get a few names, take a look at the websites of the CPAs and get an understanding as to how they work. You also want to read reviews and check out client testimonials.

Who Does Your Taxes?

If you hire a CPA, you want to know that they’re the ones doing your taxes, not an office manager or intern. You should ask this question before you decide to hire a CPA.

If you’re hiring an individual CPA, you want to know how they review their work. Do they have a colleague that reviews their work to check for errors? Working with someone that has these protocols in place will limit mistakes and issues with your tax returns.

Estimates and Payment Schedule

Finally, ask the CPA how they bill clients and when the funds need to be paid. A CPA should be able to give you a rough estimate to do your taxes after speaking with them. The amount isn’t set in stone but will give you a good idea as to how much you can expect to pay.


In your business, you go out of your way to do everything perfectly. Why wouldn’t you do the same with your taxes when the consequences of mistakes can be severe? Don’t let the cost of hiring a CPA get in your way.

How much does it cost to have a CPA do your taxes? It depends on how complex your tax return is and how organized you are. It’s not just about the cost, it’s the time that you’ll save. 

Check out the Business section of this site for more business news and financial insights.

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