Shocked to see REP pricing

Nice attitude!  Seems to be Intuit's repsonse to a lot of practicioner's concerns lately. 

 I'm not Intuit, sorry.

If my client came to me and said "My business only had a small profit this year, so it doesn't seem right that I should pay you as much as you'd like to charge," I'd be happy to suggest less-expensive options for them (which would likely not include me doing the return for less).  Not every product is a good fit for every purchaser.

Alex, you've posted enough here to know we are volunteer, not "Intuit". 

Pheobe didn't give you any attitude; she simply pointed out the obvious - Lacerte is expensive (and good), but it doesn't lend itself to the 1040A/1040 EZ type of practice.

Too bad we cannot give negative points for Alex's attitude.

Now that option could be a lot of fun :-)

I don't know who Alex is.  It is not important.

No I cannot just raise my fees because I am having to compete with the larger preparers such as H&R, Lib, and the rest... you know who I mean.  I know what they charge, and I cannot solicit new clients by raising my fees to more than my competitor.

As for other independants, here in CA they charge often less than the large preparer firms... so no, raising prices is not a viable option.

The catch 22 is that I cannot grow my firm with such high rep fees, and this is a frustrating situation.  I may have to pay.  But I DON'T have to be happy or satisfied with the situation.

This is more along the line of my thoughts.  Lacerte is exceptional software, however it seems to me that between the multiple fees charged by software companies and the freeware offered by IRS and in CA the FTB we independent practitioners are being pushed out.  The rep pricing is very very high, and in fact I think I could purchase Turbo Tax (an Intuit product) and pay less than the rep fee for Lacerte.  This seems morally wrong.

You can't use TT and be in compliance with the licensing terms.

I wonder if the price pressure you're getting is a regional thing?  Around here, the big chains are the high-cost providers. 

So I'm teaching this individual tax class the other day, and I ask how many are in public and how many in private accounting. And of the public, how many returns do they prepare, and which software. When one dude says about 200, and he uses TT, I ask,

"And when are you switching to PS, since you are in violation of the TT user license?"

He said yesterday.

My point was that I could purchase a copy of Turbo Tax for each client I had and it would still be cheaper than the individual reps for Lacerte.  I believe Turbo tax was going for $49 (or less on sale) and the individual reps for Lacerte are at around $55 now.  Discouraging.

Except that you can't use TT and be in compliance with the licensing terms.  Unless you do the returns for free, I guess, and that really defeats the purpose.  The license specifically prohibits any compensated use.

This is a matter of semantics... My point is I am virtually doing the return for free due to high rep pricing, so what's the difference.  I like Lacerte.  I tell everyone Lacerte is exceptional software because it is.  But... they are still not cost effective - friendly for the new practitioner with lower case file numbers.  And quite frankly, once a professional gets started with one software, they generally are not going to switch later on down the road... it would mean learning a software all over again.  With a higher workload and more case files, what practitioner in their right mind would choose to go through the learning process all over.  Intuit should be considering this issue, and their pricing should be such as to encourage the new and upcoming professionals to do business with them... not chase them away to another provider.  That is NOT good business, from any standpoint.  I'm just saying.  It's just an opinion, and apparently Intuit does not agree.

One of the CPAs in our practice group uses ATX, and another uses Drake.  Both of them say it takes a lot more time to get the returns right, but the price savings is significant.

I have used Drake in the past (for about 4 years)  It is inexpensive, well priced actually, but since using Lacerte I have learned what all the mistakes were I was making when I used Drake... guess you get what you pay for.  Drake has wonderful customer service, but you must KNOW about the tax situations (all of them) because their diagnostics are not nearly as informative.

I am also in California and whenever I look at the prices charged by H&R or others like it, they are way more expensive than I am. I am a CPA and have used Lacerte for 22 or 23 years. Fortunately I have enough individual clients that I can purchase the program and do the unlimited efiling. Of course, I still do REP for corps, partnerships, etc. I don't think the REP fees are out of line with what we get. I just pass on the cost to my corp and partnership clients.

I do understand about the 1040EZ, etc. It is hard to charge enough for them. So, what I did, is work really hard to build my practice bigger, and I don't do them unless they are kids or grandkids of other clients or someone I have known for 25 years. Even H&R in my area charges over $100 for them.

If I were you, I might advertise or use some other method to grow your business so that you can purchase the individual & CA programs and unlimited efile so you don't have the REP fees except for the corps.

Good luck to you. I hope this doesn't sound like l am telling you what to do. That is not my intent. Have a great tax season.

I worked one season at H&R Block.  The lowest fee I saw for a 1040EZ (2005) was $83.  With the $25 coupon the client had, he paid $57.  I set my 1040EZ price off of that return, and I've been charging $65.  But with a rep pricing of nearly $55 for that return, I will only make $10 on those clients.  With IRS mandating eFile for all preparers who do 11 or more returns now, one would think the rep pricing would go down, not up; and that providers will have more clients and therefore more cashflow.  Still, in the infinite wisdom of the American capitalist we will charge the startup business owner tenfold what we charge the other business owners, and quite often those high fees will be on the simplest types of returns which require the least amount of effort to design and maintain on behalf of the provider.

Example - the startup business owner does 15 1040EZs and 15 1040As and 10 1040s possibly with a Schedule A / maybe 1 or 2 with a Schedule C, some are a 1040 only because of student loan interest paid.  We'll call the rep on each of these $50 for easy math.  The startup business owner pays 40 * $50, or $2,000 for the most basic of forms.

A more established business owner purchases the unlimited eFile for federal and one state.  I believe the price is $3,398 for this package.  The firm has over 400 clients and very few are like yours with no 1040EZs and no 1040As (except the children of clients)  There are countless Schedule C's, sometimes 2 Schedule C's.  Many clients have rental properties and high W2 income; passive loss limitations and alternative minimum tax is involved.  The forms and tax law to be addressed by the provider are quite complex.  Yet the firm with 400 clients pays an average rep of only $8.49 per return.

It's not just tax software providers.  This issue has made me understand that our entire society is built upon big business strolling through finance on the backs of little business -- little business strolling through finance on the backs of startup business.  It's completely backwards.

Don't we all complain that the rich are avoiding taxes while the middle class pays heavy tax and is hitting AMT???  Same Same.  The big guy (the rich guy) letting the little guy (the middle class guy) pay the cost of doing business, or in this case of saving money.

So, I'm just pointing this out.  It's wrong.  Lacerte is a great product, but the pricing is not fair... just like so many other things in our Society.  Lacerte is not alone, and maybe one day they will lead the way and fix this issue to be fair to all preparers who want to use their services.