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My fee schedule is broken down into four categories:
- Tax Return Preparation
- Expert Witness (litigation)
My fees for preparation of Federal and State tax returns are based upon the type and number of schedules required for reporting your income and expenses, and the number of schedules I need to prepare as attachments. Wage earners generally require fewer schedules, so the cost for those returns is usually less than the more complicated returns that contain business, rentals and/or significant investment transactions. I will be pleased to E-mail you an estimate of my fee for preparing your Federal and State income tax returns if you furnish me a copy of your last filed return along with any significant changes in your financial transactions for the year of preparation. You can receive an estimate of the cost for your returns by clicking here and completing the short questionnaire.
I provide all my clients with a Tax Organizer to help them remember all of their deductions as well as the various types of income they earned. Using this Tax Organizer helps me save time in the return preparation process, and helps to keep my preparation fees very competitive.
A deposit toward the return preparation fee will be due when we either meet and go over your records, or you e-mail/mail/fax copies of your information documents (W-2, 1099’s, 1098’s, K-1’s, etc.) and your Tax Organizer to me. After I have drafted the return(s), I will e-mail you a PDF of them for your review, together with any questions or observations I have concerning items you may have overlooked or other ways to reduce your tax liability. The balance of the fee will be payable after you have reviewed and approved the final draft of your return.
For individuals who live in the San Fernando or Santa Clarita valleys and because of age or disability have difficulty getting to my office in Santa Clarita, I offer in-home return preparation. I do charge a reasonable travel fee to cover my gas expense and time on the road. My mobility challenged clients appreciate the personal service and convenience that in-home tax preparation offers them.
As mentioned above, the process of having me prepare your return will begin with you completing a Tax Organizer. This document is available in an Excel spreadsheet format, or in a PDF (Adobe Acrobat) version. The Organizer and instructions will be provided to you once I have received the deposit and signed engagement letter.
My fees for representing individuals, partnerships and corporations before the Internal Revenue Service (for an IRS audit, IRS collection or an IRS appeal of either division’s determination), Franchise Tax Board (FTB), or EDD are based upon an hourly rate plus any out-of-pocket expenses. Examples of out-of-pocket expenses include travel to and parking for meetings with IRS and other tax agency representatives, photocopying, certain research (e.g., DataQuick, Pacer, etc) and necessary out-of-pocket services.
For Federal or state collection or examination representation, and for IRS Appeals’ representation, I do require a retainer. The retainer is in the form of a deposit to be applied to your final invoice. The typical retainer to resolve a Federal or State Collection controversy (typically through a full installment agreement, a partial-pay installment agreement (PPIA), an offer-in-compromise, or a determination that your case qualifies for a status of “currently not collectable” ) is $1,325; for Examinations (audits) of your income or employment tax returns, the usual retainer is $1,800. For potential offer-in-compromise (OIC) cases (discussed below) with complex financial issues (such as a trade or business that requires significant analysis for either future income determination or liquidation value), the retainer will be $1,500.
At the end of our engagement when you no longer need my help, your retainer will be applied to your final invoice and any unapplied balance will be refunded Your final invoice will include a charge for one hour to cover your case closing expenses – including the preparation of the termination of engagement letter, notifying the tax agencies (and specific employees, if necessary) that I am no longer representing you, archiving your case file documentation, and my responding/forwarding post-termination communications I will receive from the client as well as the tax agencies.
For any corporation, partnership and other entities where my anticipated work within a month may be significant – often the result of IRS, FTB, EDD or other state tax agency enforcement activities, I may require a larger retainer.
My practice is to invoice clients on the last day of the month for services rendered and expenses incurred during that month. I provide all clients with an itemized accounting of my time and expenses. All invoices are issued Net 10 meaning payment is due within 10 days from the date of the invoice. For the convenience of my clients, I offer alternative means for payments – cash, check, money order, PayPal, Zelle and major debit/credit cards.
Offers in Compromise
All IRS and State Offers in Compromise (a process whereby we propose to resolve or settle your IRS or State tax balance for a percentage of what is owed) are handled on an hourly rate basis. I found through experience that doing these OIC cases for a fixed fee either resulted in my client paying more than they would have on an hourly basis (because the client was efficient in completing forms, assembling and indexing attachments, etc.), or I ended up spending more time than anticipated because of problems I encountered in getting the right records, dealing with inconsistent or missing information, tax agency issues, etc.
With hourly billing, the more time and effort my client is willing to put into the required tasks, the less it will cost for the entire process. Clients appreciate the opportunity to reduce representation costs by doing as much of the work as possible under my guidance. This is particularly important if we have to do an IRS appeal of a proposed rejection of an OIC (Form 656 or 656-L) by the Centralized Offer in Compromise unit at one of IRS Service Centers that perform the initial review of the OIC. Which Service Center you file your Doubt as to Collectability OIC is determined by your address. All Doubt as to Liability OICs are filed at Brookhaven (under current procedures). You can read more about the IRS OIC program on their website (https://www.irs.gov/payments/offer-in-compromise). I also discuss the OIC process in depth under the Technical Issues page of this website.
While taxpayers can download the OIC forms and instructions from the IRS website, I do not recommend any taxpayer attempt to do an OIC on their own. The process is very challenging. Almost all IRS OICs will require appealing a proposed rejection by the Service Center to IRS Appeals. Care must be exercised in the OIC process concerning what information is provided – and how it is explained – in the forms and many attachments required. What specific information is provided – and how it is explained and documented – will be instrumental in the acceptance or rejection of the requested Offer in Compromise.
Processing simultaneous Offers (for example, IRS and the State of California Franchise Tax Board) typically result in less total cost than submitting them at different times. If you wish me to process simultaneous OICs for the IRS and one State agency (such as the FTB), for typical individuals the retainer will be an additional $795.
It is important to understand that there is NEVER a guarantee that either the IRS or the State tax agency will accept an Offer in Compromise. A denied IRS request for an OIC in certain circumstances can be appealed to the United States Tax Court (alleging that the IRS abused its discretion in denying the OIC). Historically, taxpayers (petitioners) have not done well in these Tax Court cases. Further, the appeal to the Tax Court will require a tax attorney to assist you in filing a petition with the U.S. Tax Court and to represent you at trial.
If you are considering filing an OIC, it is very important that you retain a representative intimately familiar with the OIC process who will be able to present your OIC case as persuasively as possible. Please be sure to read the material on this web site that discusses Offers in Compromise in more depth. I have had excellent results in getting client OICs accepted.
As mentioned in several places on this website, there is no charge for my initial e-mail consultation for discussing your potential qualification for an Offer in Compromise – providing that you have completed and submitted the OIC questionnaire. Please read the Consultation page for more information on this.
As noted above, I offer free E-mail consultation for determining your potential qualification for an Offer in Compromise to resolve your tax liability – providing you first complete and submit the questionnaire,
I offer limited free initial E-mail consultation for answering general questions regarding an audit or collection notice you just received. For instance, you just received a Notice of Intent to Levy (letter CP504) from the IRS, and you want to know what it means, and what likely will happen next.
Please understand that free consultation does NOT include giving you specific guidance on how you can protect your assets or assessing your chance of prevailing on an IRS, FTB or other tax agency appeal given your specific financial situation.
For your telephone or E-mail consultation concerning your personal options for a specific tax audit or collection issue, you will need to remit the fee (minimum of one hour) in advance at my current hourly rate. This fee may be paid by check, money order, debit or credit card, or by PayPal.
If following our consultation you retain me to represent you in resolving your tax controversy, any unused consultation time will be applied toward your representation services. Further, as noted on the Consultation Page, if you retain me to represent you and our engagement is in place within seven (7) days of our consultation, I will apply one (1) hour of the consultation fee toward your retainer. That in effect means your specific consultation of one hour was free!
Office consultation to discuss your specific tax controversy does require a minimum of one (1) hour prepaid fee before our meeting. You can either make the electronic payment or mail a check or money order to reservhe a time. Additional blocks of 30-minutes each can be purchased as needed. Please E-mail or call me for more details.
After we have discussed the subject of your specific tax controversy and set up the time and date for our consultation session, if you prefer not to use one of the two electronic methods of advance payment (credit card or PayPal), you may remit your consultation retainer by check or money order payable to Richard E. Norton, E. A., and send it to:
23837 Sarda Road,
Santa Clarita, CA 91355
Please include with your payment a brief letter with your full contact information (daytime, evening and mobile phone number, fax number (if available), as well as your E-mail address).
If you wish to use a credit card or PayPal for making your advance payment, please E-mail or call me and I will provide you with instructions by return E-mail. Please be sure to include all of your contact information in your E-mail so that I can get back to you promptly after confirming your payment.
I understand how stressful the receipt of a tax agency notice – specifically, a Notice of Levy, Notice of Seizure or Notice of Lien – can be. For this reason, I am generally available for telephone consultation seven days a week, including evenings if necessary. Some Tax Agency Notices provide a limited period of appeal. For that reason, I recommend you act immediately upon receiving a tax agency notice so as to not forfeit your right to an appeal of the proposed action (or action already taken – such as a lien or levy filing).
Once I have received your payment or confirmation of receipt of the payment by the credit card company or by PayPal (if you used either electronic service), I will contact you to set up a mutually agreeable time to discuss your tax controversy. In advance of this consultation, I suggest you fax, scan/E-mail or mail me your tax agency notice (if you have not already provided it to me) and any other information I ask you to send me for my review so that during our consultation I may best advise you on your options for the resolution of your tax controversy.
Additional telephone or e-mail consultation time beyond the time purchased, if needed, is available at my standard hourly rate payable in additional blocks of 30 minutes. Office consultation is billable at 1/10 of an hour increments (after the initial 1-hour block) at my standard rate.
Just to recap, my initial e-mail consultation exclusively for evaluating your potential qualification for an Offer in Compromise – doubt as to collectability (once you have completed and submitted the Offer questionnaire) is free. Any discussion of other aspects of your case (such as challenging your underlying liability, audit strategies, asset protection, appeals, installment agreements, etc) would be considered a formal consultation engagement, or as an integral part of our representation engagement.
Please note that other professionals – EA’s, CPA’s. Tax Attorneys – who are assisting their clients with the resolution of client tax issues are not eligible for free consultation. However, they may certainly purchase consultation from me for the purpose of obtaining my assistance in guiding them through their client’s tax controversy resolution process.
My fees for testifying as an IRS expert witness depend upon the case, the location of the trial and other variables that need to be discussed. If you are an attorney, plaintiff or defendant involved in litigation and are in need of an expert, please contact me and we can discuss your case and the potential value of my testimony.
Why Don’t We Have Fixed Fees?
I occasionally get asked this question. The reason is pretty simple. Every taxpayer’s situation and financial condition is unique, and therefore, one size (price) doesn’t fit all when it comes to tax representation and preparation. I am aware that some national chains and outsourcing solutions use fixed fees or fixed pricing based on forms or schedules filled out, or the type of service to be offered (such as an Offer in Compromise). In my experience, the cost is typically excessive as the firm is trying to cover all potential issues that could arise during the process.
Remember the old saying, ‘You get what you pay for.’ Do you really think you will get a quality job if a firm offers a fixed price for, as an example, a preparing a return with a business Schedule C and a taxpayer comes into their office with numerous categories of expenses or financial transactions? Many firms offering fixed fees often utilize personnel to do the actual work who are insufficiently trained in taxes and procedures. You may save some money in preparation or representation fees, but there is a significant risk that an audit could result in the IRS or State agency issuing a bill for thousands of dollars in additional tax, penalties and interest. As an alternative, if a return is not properly prepared (for example, deductions are overlooked), the taxpayer may end up paying excessive tax, penalties or interest at time of original filing.
Using a fixed representation fee will always result in some clients paying more than they should have had to pay for the services. That’s not fair to clients. That’s why almost all credible EA, CPA and attorney professionals charge for their services based on the time actually required. By the way, it violates ethical standards for any professional to charge for services based on tax savings or the amount of your refund on an original return! Stay away from any firm that prices their services on that basis!
We believe that time-based fees are fair and in the best interests of our clients and our firm. Finally, it is important to understand that if you take up a lot of our time asking lots of questions, have complex tax matters/issues, or just need a lot of tax help, you should expect to pay more than other clients who roll up their sleeves and do much of their own research (lots of information is available on Google and the tax agency websites), are well organized and have comparatively simple tax issues.