How Much Does It Cost to File Taxes?

Filing taxes doesn’t need to be expensive. In fact, many people can file for free with tools from the IRS. Others may file with minimal costs using tax software. If you have a business or multiple investments, it may be best to hire a tax professional. If you think you may be an audit risk, it’s good to have a professional on board. Use this guide for the current tax season to see if you can file for free or need to hire a tax professional.

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How Much Does It Cost to File Taxes?

There’s no standard or single price to file taxes. The cost of filing depends on the complexity of your return. A majority of people, however, will likely be able to file taxes for free. If you make less than $89,000 in annual income, you can use the free IRS filing tool. Breakdown of Averages in Different States  

Here’s a breakdown of the average cost for preparing an itemized 1040 with a Schedule A using a professional, broken down by different states:

• California: $545 to $600

• New York: $495 to $550

• Massachusetts: $480 to $530

• Connecticut: $475 to $520

• New Jersey. $460 to $510

• Illinois: $440 to $490

• Washington: $440 to $490

• Oregon. $425 to $465

• Colorado: $380 to $420

• Minnesota: $380 to $415

• Ohio: $370 to $405

A tip: Free filing is available for those who have simple returns.

Factors that Affect the Cost of Filing Taxes

Tax Complexity

The cost of tax preparation increases with the complexity of your tax situation. Keep in mind that even DIY can be pushed into paid tiers. Complexity can impact costs with tax professionals and DIY filers. Common filing types and average costs include:

• Form 1040 (simple return): Around $300

• Form 1040 with Schedule C (self-employed): Around $200

• Corporate Tax Returns (1120 or 1120S): Around $900

• Estate or Trust Returns (Form 1041): Between $500 and $900 

Examples of Common Complexity Triggers

Here are some examples of situations that typically result in higher tax preparation costs:

• Multiple income streams: If you earn income from a combination of sources — like freelance work, rental properties or investments — your tax preparer will need to file additional schedules (Schedule C for self-employment income or Schedule E for rental income).

• Rental income: Having rental income means you have to keep track of expenses, depreciation, property taxes and mortgage interest.

• Self-employment: You must report business income and expenses, and calculate self-employment tax (15.3%). You also may need to make quarterly estimated tax payments.

• Investment: You have to account for capital gains taxes and dividends.

• Ownership of a small business: Business owners must account for expenses, depreciation, payroll and other business-related deductions, often requiring forms like 1120 or 1065.

• Itemized deductions: Claiming deductions for mortgage interest, medical expenses or charitable contributions may involve additional forms and documentation.

• International assets or income: Reporting foreign investments, income or accounts requires specialized knowledge and forms like FBAR or Form 8938

• Recent life changes: Events like marriage, divorce or the sale of a home can add layers of complexity to your return.

How You File Your Taxes

You can file your taxes in the following ways: DIY, software or a tax pro. Here’s an overview of these filing methods:

DIY

This option is the lowest cost with minimal guidance. It’s best to use the IRS free filing tool or basic software if you have a simple return — one W-2 and standard deduction.

Paid DIY Software

This option has some costs associated with it, but it also offers support and guidance. This software will help you identify deductions and credits.

Tax Professional

A tax professional offers maximum support, but costs more than either DIY method. However, you'll receive the expertise you need and your return will be compliant.

State Tax Returns and Add-Ons

Be aware that a free federal filing may not always include state returns. State returns usually cost extra, as do add-on services. Common add-on services include the following:

• Live help

• Audit protection

• Identity theft protection

• Representation services

Cost To File Taxes With Online Tax Software

Online platforms allow users to file taxes in a relatively straightforward way with minimum costs. Some people who meet certain income thresholds with simple returns often qualify for free plans, while more advanced features cost between $40 and $200, depending on the complexity of your return.

• Free: No charge for simple federal returns.

• Basic/Deluxe: For returns with deductions and additional forms, it can be an additional $20 to $80.

• Premium/Self-employed: This service can be an additional $60 to $150 and up.

• State returns: For each additional state return, the cost is $20 to $50.

Here are common triggers for an upgrade:

• Self-employment income

• Investment income

• Rental property income

• Itemizing deductions

Cost To File Taxes With a Tax Professional

The expertise of the tax preparer plays a significant role in determining the tax preparer’s cost. Here’s what you can expect:

• Certified public accountant (CPA): The average cost of tax preparation by a CPA can be anywhere from $400 to $1,000+ – depending on the scope of work.

• Tax attorney: Known for handling legal tax matters, they charge $300 to $600 or more per hour on average for accounting services.

• Enrolled agent (EA): Licensed to represent taxpayers, EAs typically charge more than CPAs, ranging from $300 to $600 per hour.

Why Professional Preparation Costs More

Professional preparation may cost more since it’s likely not a single meeting once a year. A tax professional may discuss strategy with you throughout the year. Also, if you’re audited, you may pay more for representation. Lastly, if you’re trying to navigate more complex tax laws, you may want to hire an attorney.

When Paying a Professional Makes Sense

There are a few situations when paying a professional makes sense. Here are those situations:  

• You own businesses.

• You have several investments.

• You’ve undergone a major life change.

• You need high net-worth planning.

Free (Less Costly) Ways to File Taxes

If hiring a professional doesn’t fit your budget, several cheaper ways to file taxes exist. Here are the top options:

IRS Free Filing Tool

The IRS offers options for free tax filing programs for taxpayers meeting certain income thresholds, typically those earning $89,000 or less annually. You can explore guided tax preparation software or free fillable forms if you’re comfortable filing without assistance.

Volunteer Income Tax Assistance or Tax Counseling for the Elderly

The VITA program offers free filing help to individuals earning less than $69,000, people with disabilities and limited English speakers. Tax Counseling for the Elderly (TCE) assists seniors 60 years and older, and focuses on retirement-related tax issues. Both services are free for qualifying taxpayers.

Less Costly Options

If your income is too high for a free option, you can opt for tax preparation software, which can be less expensive than paying for a professional.

Tax Preparation Software

Online platforms allow users to file taxes in a relatively straightforward way with minimum costs. Some people who meet certain income thresholds with simple returns often qualify for free plans, while more advanced features cost between $40 and $200, depending on the complexity of your return.

Eligibility: Keep in mind whether you can use the free option can change from year to year. Make sure you check income requirements before considering the IRS free options.

How To Lower the Cost of Filing Taxes

Planning ahead lowers the cost of filing taxes and prevents unexpected surprises. Here’s the approach you can take:

1. Organize your documents prior to filing. Collect your W-2s, mortgage interest statements, 1099s and other related documents. You want to make sure you’re not missing anything.

2. Don't pay for unnecessary add-ons. Software programs have things like audit defense, upgraded support and identity protection that all cost extra.

3. File early. Many software programs have discounts if you file early.

4. Choose the right filing method. If you have a simple tax return, you’ll be able to use either the free or basic plan.

5. Check what the software package includes. State returns and additional forms cost extra.

Should You Pay To File Taxes?

Paying to file your taxes can be worth it in certain situations. A key advantage of paying to file taxes is that it minimizes errors and may save time. Here's a look at the pros and cons:  

Pros

• You potentially save time with a tax professional because they have knowledge about what forms to use and how to file.

• You don’t miss out on deductions and credits.

• Your tax return is likely compliant and accurate.

Cons

• Professional services can be costly. You could be paying an additional $300 to $500 or more to file.

• You may not need a service to file your taxes. Remember, if you make less than $89,000 you can file for free.

Takeaways by Filer Type

• Simple: If you are a W-2 employee and want to take standard deductions, you can use the free filing via the IRS or basic software.

• Moderately complex: If you have investments, multiple investment sources and itemized deductions, paying for a software is potentially worth it.

• Highly complex: Rental property, a business ownership and self-employment may be complexities that a professional can address.

FAQs

Should I pay someone to do my taxes?

It depends on your tax situation. If your tax situation is complex, then you should consider hiring a tax professional.

How much do tax preparers charge per hour?

There’s a range of hourly rates. The hourly rate is from $100 to $300.

Are tax preparation fees tax deductible?

For personal tax returns the tax preparation fee isn't deductible. Those who are self-employed or are business owners may be able to deduct tax preparation fees for their businesses.

Why do tax software prices increase mid-filing?

As the filing deadline approaches, the price of the tax software may increase.

Will filing an extension cost money?

You can file a tax extension for free, but you will still owe taxes by the deadline.

Jacinta Majauskas contributed to the reporting for this article.

Sources:

• Invedus. "What Is the Cost of Filing Taxes in the US in 2026? (Complete Guide).

• IRS. "2025 Schedule A (Form 1040).

• IRS. "About Form 1120, U.S. Corporation Income Tax Return."

• IRS. "About Form 1065, U.S. Return of Partnership Income."

• IRS. "2025 Schedule C (Form 1040)."

• IRS. "2025 Schedule E (Form 1040)."

• IRS. "Report of Foreign Bank and Financial Accounts (FBAR)."

• IRS. "Form 8938."

• IRS. "E-file: Do your taxes for free."

• IRS. "Free tax return preparation for qualifying taxpayers."