Minnesota tax prep fees average $208

Minnesota taxpayers can expect to pay $208 for a professional to prepare an itemized Form 1040 with Schedule A and a state tax return, according to a recent survey by the National Society of Accountants (NSA).

This average cost in Minnesota is just slightly higher than the national average of $205.

"The diversity among the states, variations in supply and demand in different areas, and variations in the cost of living are all factors in determining fees," says NSA President Andrew T. Morehead, CFP, ATP, ECS. "But the bottom line, with an increasingly complex tax code and last-minute changes in this year's tax laws, is that taxpayers are often happy to have a professional take this headache off their hands."

Internal Revenue Service (IRS) statistics show that 63 percent of individual tax returns are filed by tax preparers on behalf of their clients.

Morehead added that the cost of professional tax preparation services has increased only 2 percent annually during the past two years, which is less than the rate of inflation.

"It's an excellent value," he says. "Professional tax preparers are paid to keep up with the latest changes in the tax laws, and they know where the possible deductions, tax credits, and other savings are. Even finding one deduction that person might miss on their own can pay for the cost of preparing the return."

The average fee to prepare a return assumes that clients provide well-organized records and don't have many complicating factors such as operating a business.

"If someone shows up with disorganized records jammed in a shoebox, the fee could be higher," Morehead says.

Tax preparation professionals are also familiar with e-filing procedures, which more and more taxpayers are choosing. The NSA survey shows that 80 percent of clients eligible for electronic filing choose this option. This is an 18.4 percent increase over the previous year. Most accountants (77 percent) do not charge an additional fee for electronic filing. If a fee is charged, the average amount is $23.15.

For more information and to use an online search directory to identify a qualified tax preparer in your area, visit www.nsacct.org and click on "Find a Professional" or call 800-966-6679.