Let’s Talk About Pricing. Yes, We Can Do That.

It’s March. You’re deep in tax season. You’re exhausted, you’re behind, and somewhere between your fourteenth 1040 and your third cup of coffee (not medical advice), a thought creeps in that you’ve been pushing off since January:

Am I charging enough for this?

So you do what any reasonable professional does. You go to a Facebook group and ask what other practitioners charge for a basic 1040. Or a representation matter. Or a business return with three K-1s and a depreciation schedule that looks like it was prepared at 2AM.

And within four minutes, someone drops in with the classic: “We can’t discuss pricing. Sherman Act.”

Let me save you some time. That response is overstating the rule, and usually confusing conversation with coordination. Just like in tax law, context and nuance matter.

The Sherman Act Does Not Say What You Think It Says

Section 1 of the Sherman Antitrust Act prohibits competitors from entering into agreements to fix prices. That’s the keyword: agreements. Contracts. Combinations. Conspiracies. Coordinated action that restrains trade.

If you and I get on a call and decide we’re both going to charge $500 for an installment agreement and neither of us will go lower, that’s a problem. If a professional organization sets a fee schedule that members are expected to follow, that’s a problem. If competitors agree, explicitly or implicitly, to standardize pricing or avoid competing on price, that crosses the line.

But you, an individual practitioner, independently telling another practitioner what you charge? That’s not automatically price fixing. Absent an agreement to coordinate or restrain competition, sharing your own pricing information is not the same thing as collusion.

Now, there is nuance here. Trade associations and competitor groups must be careful. Repeated exchanges of sensitive pricing information, especially if they influence coordinated behavior, can raise antitrust concerns. Organizations often adopt strict policies to avoid even the appearance of impropriety. That caution makes sense from a risk-management standpoint.

But organizational caution has somehow mutated into a widespread belief that tax professionals cannot discuss pricing at all, anywhere, under any circumstances.

That belief is not supported by the statute. And it’s costing practitioners real money.

The Oil Change or the Spa Day

Here’s the thing about pricing that nobody wants to say out loud: price reflects the experience, not just the deliverable.

If getting your tax return done feels like getting an oil change, you’re going to shop on price. You want it done fast, done cheap, and you don’t care who does it as long as the car doesn’t explode when you drive away.

That’s a perfectly valid way to approach oil changes. Something I know very little about, I do know the 5-minute oil change is a marketing gimmick, and it always took more than 5 minutes.

But if getting your tax return done feels more like a spa day at the Four Seasons, you expect something different. You expect to be taken care of. You expect someone who knows your name, understands your situation, and doesn’t make you feel like you’re on an assembly line. And you’re willing to pay for that experience.

Both types of clients exist, and that is ok! The real question is which one you want to serve, and whether your pricing reflects the experience you’re actually delivering.

What I Pay My Therapist (and Why I Don’t Argue About It)

I’ll give you a personal example that has nothing to do with taxes. That’s the “Josh” part of this substack.

My therapist raises her rates pretty much every year. And I don’t blink. I don’t shop around. I don’t ask if she can match some rate I found online for a therapist who graduated last Tuesday. Although if I did, I’m pretty sure she would have a witty response.

Could I find someone who charges less? Absolutely. Would I get the same experience? Not a chance.

She knows my history. She understands how I think. She’s built a relationship with me over time, and that relationship has value far beyond the hourly rate.

That’s what a trusted adviser looks like.

And guess what? You are a trusted adviser, or at least you should be. Sometimes I feel like we offer a little therapy with tax, which is not always my strong suit.

If your clients see you the way I see my therapist, they’re not price shopping. They’re not comparing you to the guy running a $99 special out of a strip mall. They’re paying you because of the expertise, judgment, and relationship you provide.

So yes, raise your prices. Thoughtfully. Intentionally. Regularly.

The cost of doing business goes up every year. Software costs more. CE/CPE costs more. You know my thoughts on education: you get what you pay for. Insurance costs more. Rent costs more. If your rates stay flat while your expenses rise, you’re effectively giving yourself a pay cut.

That’s not sustainable.

If We’re Going to Talk About Pricing, Let’s Actually Talk About It

If we’re going to move past mythology and into reality, we should talk about how fees are structured.

There are generally three models. Each has its place. If you’ve ever sat through one of my classes, I usually say something to the effect, “I’m not here to tell you you’re doing this wrong; this is my perspective.” - the same applies here. At the end of the day, you do you.

Hourly Billing

The old standby. Track your time. Bill your time.

It’s transparent. It’s simple. It also penalizes you for becoming efficient. The better you get, the faster you work, and the less you earn.

I still use hourly billing when the scope is genuinely unpredictable. If a case is such a mess that I can’t reasonably estimate the time involved until I’m knee-deep in it, hourly may be appropriate. But I try to move off it as soon as the scope becomes clear. It can still have its place, but it's few and far between for me.

Flat Fee (Fixed Fee)

This is where I live for most engagements.

You assess the complexity. You quote a price. That’s the price.

The client knows the cost up front. You know what the engagement is worth. And if you complete the work efficiently, you’re not penalized for competence.

A straightforward installment agreement is not the same as an OIC with five years of unfiled returns and an active levy. Price them accordingly.

Value-Based Pricing

This is the more advanced model.

You price based on the value of the outcome to the client rather than the time involved.

If you negotiate an Offer in Compromise that resolves $200,000 in tax debt for $15,000, the value to that client is life-changing. Pricing solely by hours in that context may not reflect the true impact of your work.

Value-based pricing requires confidence, clarity of scope, and strong communication. I use elements of it in representation cases where the financial stakes are significant.

Subscription Pricing

This has evolved into a model I have embraced for certain engagements. For X dollars per month, the client receives a menu of services. I have several representation engagements right now that are on this model. The client knows what they are paying, and I know that, as long as the case is active, I will be paid.

All of these pricing methods have a place in the modern tax practice.

What I Actually Charge

Since everyone wants data points but few people are willing to share them, here are mine.

These are general ranges. Your experience, overhead, and positioning may differ. I’m not telling you what to charge. I’m giving you information so you can make informed decisions.

Tax Preparation

Individual returns: $750 and up based on complexity.

Business entity returns: $1,500 and up, sometimes significantly up, depending on entity type and bookkeeping condition.

Now, are some returns much less than this? Yes, but that is not the norm; I’d be lying if I said there were not exceptions from time to time. That’s one of the advantages of owning your own practice.

Representation Work

This is where it can be all over the place. But as a general rule, I do not get an 8821 or 2848 for less than $1,000. Most of my representation engagements are subscription-based at $995 a month.

As representation can range from a simple installment agreement to a full-blown examination with multiple items, I have been known to use different pricing methods.

Also, if you are handling a non-filer case, this is a representation case. I know some on social media will disagree with me (and have before), but this is still a representation case. Always look at the transcripts and for the love of all things holy:

1. Only file the years you are required to file.

2. Avoid conflicts of interest with married couples

3. Review the transcripts (yeah, it’s important to say that again)

If those numbers feel high, that’s okay. They are not designed to compete with the lowest-cost provider in the market. They reflect the experience, risk management, and depth of representation I bring to the table.

If those numbers feel uncomfortable because they’re higher than what you charge, that may be worth examining.

But if you’re reading this and thinking, “Wow, I could never charge that,” then yes, you could. You don’t have to change overnight. This is all a process, and none of us has magic solutions. Trial and error.

If you’re thinking “That’s unconscionable,” I’ll politely refer you to Williams v. Walker-Thomas Furniture Co., 350 F.2d 445 (D.C. Cir. 1965), and let you look up the legal definition.

Stop Apologizing for Your Prices

This is where the real issue sits.

Too many practitioners feel guilty about charging appropriately.

You invested years in getting your license. You maintain continuing education. You carry professional liability insurance. You interact with the IRS, which, as we all know, can be administratively challenging (who says I can’t be diplomatic from time to time). You manage clients who are anxious, overwhelmed, and sometimes not entirely forthcoming.

You carry significant responsibility.

Charging a professional fee for professional work is not something you need to apologize for.

If a client does not want to pay your rate, that’s fine. There is a segment of the market that competes on price. You don’t have to.

The Real Reason This Conversation Matters

The secrecy around pricing doesn’t protect the profession. It distorts it.

New practitioners undercharge because they have no benchmarks. Experienced practitioners hesitate to raise rates because they lack context. Firms become overworked because they are priced below capacity.

When practitioners are chronically underpriced, they are chronically overextended. And when they are overextended, quality suffers. You cannot do your best work when you are exhausted and working 80 hours a week.

Transparency does not mean uniformity. It does not mean coordination. It does not mean setting industry-wide rates.

It means professionals sharing information so each of us can independently determine what our work is worth.

That’s not collusion. That’s professional maturity.

So the next time someone asks what you charge for an installment agreement, you don’t need to invoke federal antitrust law.

You can simply answer the question.

We could all use a little more clarity and a little less secrecy in this profession.

If you want a deeper dive into pricing models, Compass Tax Educators has an upcoming workshop on Pricing Strategies. Check it out.

(This is not sponsored, and I am not compensated for mentioning this. I want my readers to get the best, so I share links to upcoming events I believe will be valuable.)

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