Page 8 - VTaxOnDemand Independent Industry Analysis of Accounting Industry

a. In 2013, almost half of all EITC filers purchased either a RAL or RAC, including
80 percent of EITC filers using paid preparation.
b. More than 20 million RACs were purchased in tax year 2012, a 60 percent
increase from 2 years prior. And, according to IRS data, 84 percent of tax filers
who obtained a RAC in 2013 had low incomes, and about 40 percent of EITC
recipients obtained a RAC.
c. A typical RAC (though not a form of credit) costs at least $30, which would
represent a 414 percent APR on a $189 preparation fee.

2.) Liberty Tax Service Consumer Complaint Board: Complain Board
3.) Jackson Hewitt Consumer Affairs Complain Board: Complaint Board
4.) H&R Block Consumer Affairs Complain Board: Complaint Board
5.) The IRS does not regulate tax preparations fees, nor has any legislation to tackle the issue
been introduced in Congress. However, there are multiple outlets online (mainly tax
consumer complaint boards) clearly articulating excessive fees, unscrupulous business
practices through marketing, cumbersome fee structures, and fraudulent business
practices.
6.) According to the GAO, tax-prep costs, even within the same tax-prep chain, will vary
wildly from preparer to preparer, making it difficult to have any idea what one should be
paying for services. Undercover investigators paid anywhere from $160 to nearly $600
for tax-prep services.
7.) Many tax preparers, especially those who serve underbanked consumers, will offer
financial products like refund anticipation checks, which get you your estimated refund
now but at a price, with the issuing bank taking anywhere from $25-60. Beyond that,
some of these preparers will then tack on their own fees — in addition to the cost of the
tax preparation — further depleting your refund.
8.) Fees also vary by region. The average tax preparation fee for an itemized Form 1040 with
Schedule A and a state tax return in each U.S. Census district are as follows:
a. New England (CT, ME, MA, NH, RI, VT) – $205
b. Middle Atlantic (NJ, NY, PA) – $252

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