A warning to everyone who has not yet filed their taxes: Tax filing fees are rising this year and if you don't ask, a good chunk of your refund could disappear.
We're now in March, and taxpayers are starting to scramble to get their taxes done, especially if they expect a refund. However, rushing to find a preparer and not getting a detailed estimate of the fees can lead to some unexpectedly high charges, as one woman learned.
Simple Filing Turns Into Big Bill
Megan Bader needed to file her taxes, so she went to a storefront tax preparer. What she thought would be a simple filing turned into a big bill.
"She explained what I was signing. I trusted what I was signing was what she was telling me, and she ended up charging me over $420 to do my taxes," explained Bader.
Bader says the transaction was little more than an EZ form.
"Nothing, just working. I have nothing to claim - no kids, no property, no house," said Bader.
The franchise owner says Bader's bill was higher than normal because her tax prep fees came out of her refund, which essentially made her fees a loan. The owner says had she paid cash up front, the fee would have been much lower.
Bader's boyfriend, who was with her, says that was never explained to them.
Turns out the office has an 'F' rating from the Better Business Bureau, in part from complaints about fees.
What Is Reasonable?
-The National Society of Accountants says the average tax prep fee for 2013 is $150.
-A fee can be $250 if you itemize your deductions.
Since Bader earned less than $57,000, she may have been able to file free through the IRS website. Bader says next time she'll start there first.
Ask detailed questions before turning over your W2s to a tax preparer.
Check out their record at the Better Business Bureau. If they have an 'F' or some sort of alert, you may want to consider someone else, so you don't waste your money.
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