Tax Preparation Cost: Average Fees Explained

You have three broad ways to get a return filed: do it yourself with software, hand it to a paid preparer, or use a free program if your income qualifies. Each path has a different price structure, and the right one depends on how many forms your return needs and how comfortable you are with the paperwork.

This page compares those paths. It covers per-form preparer fees, software and in-person prices, and the free filing option. Figures come from published surveys and company price pages, and any list price can change during the season.

The numbers above come from a National Association of Tax Professionals (NATP) survey reported by Accounting Today. The base fee covers a standard Form 1040. Each additional schedule is priced as an add-on.

Enrolled agents averaged more than non-credentialed preparers for the base form. The range in the headline reflects community size, so a preparer in a small town and one in a large metro area may price the same return differently.

Add-ons stack up. A filer who itemizes deductions, reports self-employment income, and sells investments could need Schedules A, C, and D in the same return. Ask whether the quote is for the base form alone or for the full set of forms you will need.

Software replaces the preparer with a guided questionnaire. Prices rise as the return gets more complex, and state filing is often an extra charge.

TurboTax lists three levels. Filing yourself starts free for the simplest returns and rises with the tier. The version with on-demand expert help costs more. The full-service option, where an expert prepares and files, shows a starting price only, so the final bill can be higher. These prices come from the vendor's pricing page, which does not show a date, and list prices can change during the season.

Jackson Hewitt appears in the CNBC Select comparison with a flat price for its online product covering federal and state, and a starting price for in-person service. Starting prices usually exclude add-ons and state returns, so treat them as a floor.

The IRS Free File program pairs eligible taxpayers with guided software from partner companies at no charge. Eligibility depends on adjusted gross income, and the limit in the table above is the figure to check against your own return. Details and the current list of partners are on the IRS Free File page.

Some software companies also offer free tiers for simple returns, though state filing or extra forms can move you into a paid tier. Volunteer programs run through the IRS also exist in many communities for people who meet income or other criteria.

Sources describe different services, so the dollar figures do not match.

The Accounting Today figure is a base-form range by community size. CPA Trendlines reports one average across all preparers surveyed by NATP. The TurboTax number is the starting price for an expert who files for you, which may reflect a different scope than a standalone preparer's base fee. A starting price is the lowest tier, not an average, so it may land below what you end up paying.

• Number of forms. Each schedule and each state return typically adds to the total.
• Income type. Wages are simple. Self-employment, rental income, and investment sales take more time.
• Preparer credentials. Enrolled agents and CPAs often charge more than non-credentialed preparers.
• Location. Community size shows up in the survey ranges.
• Software tier. Moving from a free tier to a paid one usually follows from adding forms.
• Timing. Late filers and amended returns may be priced separately.

Software tends to fit people with straightforward returns who are comfortable entering their own numbers. A preparer may be worth the fee when you have a mix of income sources, a recent life change such as a home sale, or an IRS notice to answer. Free filing suits people under the income limit with a basic return.

None of these choices removes your responsibility for what the return says. For guidance on your own situation, talk to a tax professional.

• Gather documents before you start so the preparer spends less time sorting.
• Get the quote in writing, and ask which forms are included.
• Check whether you qualify for Free File before paying for software.
• Compare the state-return charge, since it is often separate.
• Keep your return straightforward where you can. Fewer schedules usually means a smaller bill.