Everyone’s heard the expression “money buys justice.” Don’t believe that wealth should have anything to do with getting a fair outcome in your tax audit. Instead, everyone in an audit deserves to have a lawyer on their side who will defend their rights and get them the possible outcome. It’s for that reason that you should look for affordable IRS representation.
While it is hard to come up with standardized prices for the multitude of resolution tracks one may go down (i.e. Installment Agreement, Offer In Compromise, Currently Not Collectible), not to mention that the cost of working a particular track can be more/less complicated depending on the individual, here are some general guidelines to consider as a “middle ground” so to speak:
Base Fee: ($500 – $1,000) Most companies will charge a certain “minimum fee” to analyze your case, review IRS records/transcripts, and ultimately determine the extent of the tax matter. While this may not be explicitly called out in their fee quote, realize that it is buried in there in some fashion.
Straightforward 1040 Case: ($1,000 – $4,000) This would be in addition to the fees mentioned above. This type of case involves back taxes, doesn’t usually involve an audit and could be either in the Automated Collection System (ACS) or it could be assigned to a Revenue Officer (RO). If the work involves interacting with an RO and potentially satisfying some of their requests, expect to be towards the higher end of the range where those dealing with ACS would tend to be towards the lower end.
Business Payroll Tax (941) Case: ($1,000 – $6,000) The variation in fees primarily will center around if the business is still operating or is closed (or about to be), and if there are Trust Fund Recovery Penalties that are being assessed to various individuals. The more periods/quarters that are involved, the more expensive it will tend to be.
While the prices listed in this post are a little dated, they provide yet another perspective on how much one should expect to pay.
A proper consultation, conducted by a competent, licensed tax professional, will yield a complete picture of the taxpayer’s situation and what they need. “Flat fee” representation services that are rather affordable and include all the fees necessary to complete your case. Likewise, the fee you will be quoted will be based on the amount of work required, not the amount you owe. Thus, if you owe $15K or $115K, the chargeable amount will be the same, every time, as long as the circumstances surrounding each are otherwise the same.
The difference between deciding whether to use a larger, well-known tax preparation company versus a smaller, independent, boutique firm where your return will be prepared by an actual IRS licensed expat tax preparer, is similar to eating fast food compared to eating at a three-star Michelin restaurant at a lesser price. The larger firm wants you to come in and sit there while the stressed-out tax preparer hastily prepares your return as a queue of people waiting in the lobby continues to fill. The smaller firm is unrushed, focused and relaxed, having you supply them with your paperwork while they take their time crafting it to provide you with the best possible outcome.