How Much Does It Cost to Do Your Taxes? The Real Numbers
Short answer: how much it costs to do your taxes runs from $0 to several hundred dollars. The IRS puts the average out-of-pocket cost of a 2025 return at about $290: roughly $160 if you have no business income, and about $610 if you file a Schedule C, E or F. Many people qualify to file for free.
Those are averages, and the IRS says most filers come in under them. What you pay depends on which forms you need and what shape your records are in, far more than on who you hire.
It’s a Sunday afternoon in late January and Carmen — I’ll call her Carmen — is forty minutes into tax software that told her, on the first screen, in large friendly letters, that it was free. She has typed in her W-2. She has answered a question about whether she owns a farm.
Then she mentions the $2,300 she made selling candles at weekend markets, and the software becomes thoughtful. There is a new screen. The screen has a price on it. The price has a state return added to it, which is a second price.
Carmen isn’t being scammed, and she isn’t bad with money. She asked a question that sounds like it has one answer and actually has about five.
Here are the five, with real numbers, where each one comes from, and — because it’s true for a lot of people — when the right amount to spend is nothing at all.
What it costs to do your taxes, route by route
Asking what it costs to do your taxes is a bit like asking a mechanic what it costs to fix a car. The honest reply is another question: well, what’s it doing? So here is the price list, sorted by how you get the return done.
- 1. Free government-backed options: $0. IRS Free File, Free File Fillable Forms and volunteer preparation through VITA cost nothing for the federal return. The catch is eligibility, and sometimes the state return. More on exactly who qualifies below.
- 2. Paid tax software: from $0 to a couple of hundred dollars. The advertised price is usually for the simplest federal return. Self-employment income, investments, rental property and each state return tend to be separate line items. The number that matters is the one on the last screen, not the first.
- 3. A paid preparer for an individual return: a few hundred dollars. Figures reported from the National Association of Tax Professionals’ 2025 fee survey put a plain Form 1040 with a state return at a little over $300, with each extra schedule adding to it. Treat that as a starting point, not a quote.
- 4. A return with business income: several hundred dollars, and up from there. The IRS’s own average for this group is about $610, and that average includes people who did it themselves with software. A messy year pushes a preparer’s fee well past it.
- 5. Hourly help: about $130 to $250 an hour. The same survey found preparers who bill by the hour average $182 an hour, with half falling between $129 and $250. Only about 7% of preparers bill this way, but it is common for cleanup work and one-off questions.
One thing that is not on this list: a tax attorney. That is a different job at a very different price, for when something has already gone wrong. We covered it separately in how much a tax attorney costs.
What the IRS itself says the average is
The best single source on this question is one almost nobody reads, because it sits near the back of the Form 1040 instructions. The IRS is, as far as I know, the only organisation that publishes an official estimate of how tedious its own paperwork is.
For a 2025 return, the IRS estimates of taxpayer burden come out like this:
- All filers: about 12 hours and $290.
- No business income: about 8 hours and $160. This is 71% of returns.
- Business filers: about 21 hours and $610. The IRS counts you here if you file a Schedule C, E or F, or Form 2106.
The dollar figure covers whatever you spent to get the return prepared and submitted: preparer fees, software, postage, photocopying. The hours are your own time, and they are not included in the dollars.
Two details in that table are worth more than the headline. The first is that the IRS says plainly that most taxpayers experience a lower burden than the average, because a small number of complicated returns drag it upward. The second is where the time goes. Of those 21 hours for a business filer, about 10 are recordkeeping. Filling in the actual form is 5.
Which means roughly half the job is looking for things.
What actually moves the price
Two people with the same income can pay wildly different amounts to file. Income is not really the thing being priced. These are.
- The number of forms. A W-2 and the standard deduction is one form. Add a side business, a rental, stock sales or a second state and each one brings its own schedule, and most preparers price per schedule.
- The state of your records. This is the big one, and the only one fully in your control. A tidy spreadsheet of income and expenses is a short job. A grocery bag of receipts is a long one, and an experienced preparer can estimate your invoice from the sound the bag makes when you put it on the desk.
- Where you live. Fees track local costs. The same survey found higher averages in the Northeast and in cities, and some of the lowest in the Midwest. A state with no income tax also means one fewer return to pay for.
- Who is doing it. CPAs and enrolled agents charge more on average than preparers with no credential. That premium buys something specific, which the next section gets into, and it is not always something you need.
- When you turn up. Some firms charge more for returns that arrive in the last couple of weeks before the deadline, and all of them have less time for you. Nobody has ever described the second week of April as a calm time to become a new client.
Prices also drift up over time. In that 2025 survey, 83% of preparers said they raise fees every one to two years, typically by 6% to 10%. If last year’s number is the one in your head, add a little before you are surprised.
How preparers set their fees, and one to walk away from
Knowing how the fee is built is the difference between a quote and a guess. There are really three models.
- Per form. A set price for the 1040, a set price for each schedule. Easy to compare between firms, and the reason it pays to ask which forms your return will need before you ask what it costs.
- A minimum, then adjusted. The most common approach: nearly half of preparers in the survey set a minimum fee and move it up for complexity. Ask what would move it. A good preparer can tell you in one sentence.
- Hourly. Fair for unpredictable work, nerve-racking for everything else. Ask for an estimate of hours and a number at which they will stop and call you.
I should admit the profession did this to itself. Accountants spent decades answering “what will it cost” with “it depends,” which is accurate and also the least reassuring sentence in the language. It is the entire reason we put our own prices on a page and left them there.
Then there is the model to walk away from. The IRS says to avoid preparers who base their fees on a percentage of the refund, and to be wary of anyone claiming they can get you a bigger refund than everyone else. A preparer paid by the size of your refund has a reason to inflate it, and you are the one who signs it.
Two quick checks from that same IRS guidance: every paid preparer must have a Preparer Tax Identification Number and must sign your return, and only attorneys, CPAs and enrolled agents can represent you before the IRS in all matters. If you think you may need that kind of representation, our guide on when to hire a tax attorney sets out where the line is.
When doing your taxes should cost you nothing
This is the section where an accounting firm tells you not to hire an accounting firm. A large share of people reading this should pay $0 for their federal return, and here is how.
- IRS Free File guided software. If your adjusted gross income is $89,000 or less, you can prepare and e-file your federal return for free with partner software. You have to start from the IRS page; go straight to the company’s own website and you get the paid version. Some partners include a free state return and some charge for it.
- Free File Fillable Forms. Free at any income. It is the electronic version of the paper forms, with limited calculations, no guidance and no state return. Think of flat-pack furniture where the instructions have no pictures. Everything is in the box. You are holding the Allen key.
- VITA and TCE volunteers. IRS-certified volunteers prepare basic returns for free for people who generally make about $70,000 or less, people with disabilities and limited-English speakers, with TCE focused on those 60 and over. Individual sites set their own limits, and a return that is too complex gets referred out.
That $89,000 figure is for the current filing season and the IRS adjusts it most years, so check the page rather than trusting the number here.
If you have a W-2, maybe some bank interest, and the standard deduction, paying anyone several hundred dollars is buying reassurance, not expertise. That is a fine thing to buy if you want it. Just know that it is what you are buying.
If you run a business, the return is the cheap part
Go back to the IRS table. Business filers spend 21 hours, and 10 of them are recordkeeping. That ratio is the whole story of what a business return costs.
When a preparer quotes $900 for a return that “should” cost $400, they are usually not pricing the return. They are pricing twelve months of bank statements that nobody has categorised, which is bookkeeping, done all at once, in March, by the most expensive person available. If the difference between those two jobs is hazy, we laid it out in bookkeeping versus accounting.
Nobody’s tax return is expensive. Their January is expensive.
- Keep the books monthly and the return gets cheap. Whether you do it yourself in a spreadsheet or hand it off, a preparer who receives clean, reconciled numbers is doing an hour or two of work, not a weekend of archaeology.
- The business part of the fee is deductible. The IRS instructions for Schedule C say line 17 includes fees for tax advice related to your business and for preparing the tax forms related to your business. Ask for the business portion to be shown separately on the invoice.
- Bundled can be cheaper than one-off. Our own plans start at $299 a month and include the monthly bookkeeping and the annual return, so there is no separate invoice in the spring. The prices are published in full, which is not a boast so much as a low bar the industry keeps tripping over.
And the honest counterweight: $299 a month is $3,588 a year. If your side business brings in a few thousand dollars and has thirty transactions, that is absurd, and software plus a tidy spreadsheet is the right answer. Monthly help starts to earn its keep when the bookkeeping is eating your evenings or the business is big enough that mistakes are expensive. Our post on whether you actually need an accountant has the signs to look for, and the services page shows what is and is not included.
What the cheapest option can end up costing
Here is the arithmetic the price tag leaves out. Take the IRS’s 21 hours for a business filer. If an hour of your time is worth $50 to your business — pick your own number — the free option cost you $1,050 before you spent a cent. At $75 an hour it is $1,575.
That does not make doing it yourself wrong. It makes it a purchase. You are paying in hours instead of dollars, and for plenty of people, in plenty of years, hours are the cheaper currency.
The cost that is harder to see is the one from rushing. A return assembled in one long weekend from a year of unsorted records is the return that leaves out the mileage, the home office, the equipment bought in February and forgotten by December. Nobody sends you a letter about a deduction you did not claim. It just quietly costs you, every year, and you never find out how much.
So the useful question is not which route is cheapest. It is which one you can do carefully. For a simple return, that is very often the free one. For a business with a full year of activity and no books, it almost never is.
Frequently asked questions
- How much does it cost to do your taxes?
- It costs anywhere from $0 to several hundred dollars. The IRS estimates the average out-of-pocket cost of a 2025 Form 1040 at about $290 across all filers: roughly $160 for people with no business income and about $610 for people who file a Schedule C, E or F. Most filers pay less than the average, and many qualify to file for free.
- How much does it cost to have someone do your taxes?
- A paid preparer typically charges a few hundred dollars for an individual return, and more as schedules are added. Preparers who bill by the hour average about $182 an hour, with half charging between $129 and $250, according to the National Association of Tax Professionals 2025 fee study. Ask for the fee in writing before any work starts.
- Is it cheaper to do your own taxes?
- In cash, almost always yes. In time, not necessarily: the IRS estimates an average of 8 hours for a return with no business income and 21 hours for one with business income, most of it recordkeeping. Doing it yourself is cheaper when your return is simple and your records are already in order.
- Can I do my taxes for free?
- Yes, in many cases. IRS Free File offers free guided software for a federal return if your adjusted gross income is $89,000 or less, and Free File Fillable Forms is free at any income. IRS-certified VITA volunteers prepare basic returns free for people who generally make about $70,000 or less. State returns are not always included.
- How much does a CPA charge to do taxes?
- CPAs and enrolled agents charge more on average than preparers without a credential, and the fee rises with the number of forms and the state of your records. There is no single national price. Get a written quote that names the forms it covers, and ask what would make it go up.
- Are tax preparation fees tax deductible?
- The business part is. The IRS instructions for Schedule C, line 17, say to include fees for tax advice related to your business and for preparing the tax forms related to your business. Ask your preparer to show the business portion separately on the invoice so the split is documented.
- Why does a business tax return cost more than a personal one?
- Because there is more to assemble and more to get wrong. A business return needs a full year of income and expenses sorted into categories, plus items like mileage, home office and equipment. If the books are already clean, the return itself is quick. If they are not, the fee is mostly paying for a year of bookkeeping done in one go.
- How do I know a tax preparer is legitimate?
- Anyone paid to prepare a federal return must have an IRS Preparer Tax Identification Number and must sign the return. The IRS says to avoid preparers who base their fee on a percentage of your refund, and to never sign a blank form. You can look up credentialed preparers in the IRS directory.
The IRS figures above are for 2025 returns and the Free File income limit is for the current filing season. Both are updated most years, so confirm them at the source before you rely on a number from a blog post — including this one.
More plain-English answers.
- Blog
How Much Does a Tax Attorney Cost? A Straight Answer
Hourly and flat-fee ranges by case type, and when a cheaper kind of help does the same job.
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Bookkeeping vs. Accounting: What’s the Difference?
A bookkeeper records the numbers; an accountant interprets them and files your taxes. Where the line falls and what each costs.
Read more - Pricing
Flat monthly plans from $299
Three plans with real prices in writing. Monthly bookkeeping and the annual return in one fee.
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