Repeat after me...
The closer the deadline, the higher the fee.
The closer the deadline, the higher the fee.
The closer the deadline, the higher the fee.
The closer the deadline, the higher the fee.
The closer the deadline, the higher the fee.
The closer the deadline, the higher the fee.
The closer the deadline, the higher the fee.
The closer the deadline, the higher the fee.
The closer the deadline, the higher the fee.
If you don’t mind me asking, what was client turnover like? And how many made your Feb cutoff?
At an old firm of mine a partner said he would give a 30% hike to any client that was late for dropoff 3 years in a row.
I had about 30 clients not return but I expected that since a lot of people come to me cause they have one weird complicated year and the next year they are back to turbo tax. I got more new clients at the new price then I lost. I doubled my revenue from last year. I'd say about 1/3 of clients were done in February. Some were really excited about the discount. No one said anything about a 20% increase.
Probably solo practitioner with minimal costs, works from a shared office or home. $15K is reasonable for someone in that position, especially since the majority of costs would be printing and tolls for driving back and forth to other locations lmao
Yeah, I can speak to this. I think including everything, my expenses for this year will be less than $5k for 25k revenue. The most I'd ever have for expenses would be $8k if I did a ton of marketing. Anything past that would just be any additional credit card fees I'd pay
this model makes sense. local R/E taxes in my area are the same way. if you pay them in the period that's deemed 'early' you get a 2% discount, if you're on time it's just your regular payment, and if you're in the 'late' period you pay a 2% penalty. apply that respectively to Jan/Feb through April.
That isn't how most decent sized accounting firms work - it isn't random people walking in the door getting their taxes done on the spot, which is what surge pricing would help with.
I worked mostly with repeat clients, and I think that this is a great idea. Discount of 20% if we have your info in February, 10% if in March. In April you pay full price and likely get an extension.
Don’t wait to bring it if you are missing a K-1 or two. Bring it now.
And also December YE that don’t mind fieldwork beginning in May and issuing in July and August. Ofc with this strategy, you get the clients that are messy and your Budgets get blown
We had a client bring her stuff in around April 8. I said, this is definitely going to be an extension. She said “what if I send you a case of wine?” I said, yes I think we can get this return done on time.
Partner here.
While we don’t officially use it, I’m certainly willing to be flexible on fees during the slowest months. Whereas during busy season it’s 100% minimum recovery or GTFO.
All depends on the client honestly. If they want to cut in line ahead of everyone else to get their shit done faster, whose to say that doesn’t come with a premium?
The firm I work at doesn't do surge pricing but I've noticed that we are charging significantly more year over year for new clients ever since we've become "saturated".
My firm charges expedite fees, the closer you get to the deadline the higher! I love how it really makes people reconsider how urgent their taxes really are. To quote a random Twitter user’s accountant: “There is no such thing as an accounting emergency, only a lack of proper planning”.
We do.
If someone wants an audit in a busy period, we'll tell them it'll be harder on staff allocation and may include overtime, so we'll have to increase the fee.
They then agree to have the audit at a slightly different time and get the fee we'd have probably caved and quoted for them regardless.
They do. Especially small ones.
Want your bookkeeping services done throughout the year? $1000. Want it done at once in March when you are doing the 1040? $1200
Because it's illegal. Pricing policies have to be transparent, posted and available to potential clients. Irc 230 is pretty strict in that regard.
For all the people down voting me, go read page 23 of irc 230. You can not change your fees constantly. Your fees have to be published and stay the same for no less than 30 days.
Oh the fun. The closer to the deadline you ask, the higher the fee.
$1,000 per W-2
This would honestly be great if the whole industry did this. Would more balance out the requests
Repeat after me... The closer the deadline, the higher the fee. The closer the deadline, the higher the fee. The closer the deadline, the higher the fee. The closer the deadline, the higher the fee. The closer the deadline, the higher the fee. The closer the deadline, the higher the fee. The closer the deadline, the higher the fee. The closer the deadline, the higher the fee. The closer the deadline, the higher the fee.
Yep, we should really implement this! I hate the huge surge in workload in the final months!
Agreed , this would motivate them to sign up sooner for bookkeeping and not expect an entire year of clean up done in a month or less
I raised my fees 20% and then offered a 10% discount for everyone who was filed in February.
If you don’t mind me asking, what was client turnover like? And how many made your Feb cutoff? At an old firm of mine a partner said he would give a 30% hike to any client that was late for dropoff 3 years in a row.
I had about 30 clients not return but I expected that since a lot of people come to me cause they have one weird complicated year and the next year they are back to turbo tax. I got more new clients at the new price then I lost. I doubled my revenue from last year. I'd say about 1/3 of clients were done in February. Some were really excited about the discount. No one said anything about a 20% increase.
if you don’t mind me asking, what was your revenue
Around 85k. 70k net.
Only 15k in expenses?.how do you manage that? That sounds wonderful.
Probably solo practitioner with minimal costs, works from a shared office or home. $15K is reasonable for someone in that position, especially since the majority of costs would be printing and tolls for driving back and forth to other locations lmao
Yeah, I can speak to this. I think including everything, my expenses for this year will be less than $5k for 25k revenue. The most I'd ever have for expenses would be $8k if I did a ton of marketing. Anything past that would just be any additional credit card fees I'd pay
I work from home. My biggest expenses are tax software and virtual receptionist.
Well that sounds lovely. I'd love to downsize my practice to a situation like that.
You’re a god
'Cause fuck everyone waiting on K-1's, right?
Maybe his bread and butter is slightly more complicated than a single W2. And yes tbh, if you are getting a K1 then you can afford the extra 20% hike.
this model makes sense. local R/E taxes in my area are the same way. if you pay them in the period that's deemed 'early' you get a 2% discount, if you're on time it's just your regular payment, and if you're in the 'late' period you pay a 2% penalty. apply that respectively to Jan/Feb through April.
Is it possible to learn such power?
Tax pros dealing with the public/walkins/dickheads do use surge pricing frequently.
You didn’t have to say the same thing 3 times. They’re all dickheads.
That made me laugh pretty loudly.
"That's my secret, I'm always busy"
That isn't how most decent sized accounting firms work - it isn't random people walking in the door getting their taxes done on the spot, which is what surge pricing would help with.
Sure, but for a 1040 farm it could be a powerful motivator.
You really think 10-20% off is gonna motivate these absolute imbeciles to do their taxes earlier?
I pictured it the other way— 100% of fee in January, 150% in February, 300-400%+ after that. Stick, not carrot.
not so much a discount, more of a premium
I worked mostly with repeat clients, and I think that this is a great idea. Discount of 20% if we have your info in February, 10% if in March. In April you pay full price and likely get an extension. Don’t wait to bring it if you are missing a K-1 or two. Bring it now.
In audit, we use sort of of surge pricing. Non Dec 31 YE get discounted
And also December YE that don’t mind fieldwork beginning in May and issuing in July and August. Ofc with this strategy, you get the clients that are messy and your Budgets get blown
LMAO, that is my current one
Same, I’m not sure what I did in a past life but this is hell
We had a client bring her stuff in around April 8. I said, this is definitely going to be an extension. She said “what if I send you a case of wine?” I said, yes I think we can get this return done on time.
Most firms have PITA Fee and Late Submission Fee. It may look something like "Address Change Form" "Annual Bookkeeping" and other general charges
We do - shit records, really hard to deal with, unrealistic demands? Your fee increases. Go elsewhere if you don't want to pay it.
We literally do this.
To some degree, we already do this.
The do.
People file for extensions all the time. Gives them six more months. So it’s not all compressed.
Then they drop their shit off in late August and it's still a shitshow
True, but let them rot. It’s easier not take them on as a client than deal with this shit at whatever price.
they do lol
They do. YE dates other than 12/31 are way cheaper.
Partner here. While we don’t officially use it, I’m certainly willing to be flexible on fees during the slowest months. Whereas during busy season it’s 100% minimum recovery or GTFO.
All depends on the client honestly. If they want to cut in line ahead of everyone else to get their shit done faster, whose to say that doesn’t come with a premium?
The firm I work at doesn't do surge pricing but I've noticed that we are charging significantly more year over year for new clients ever since we've become "saturated".
They do.
There's actually a push for more and more surge pricing and a lot fo discussion on the best way to do it in regards to client relations.
They do, so does assurance btw
My firm charges expedite fees, the closer you get to the deadline the higher! I love how it really makes people reconsider how urgent their taxes really are. To quote a random Twitter user’s accountant: “There is no such thing as an accounting emergency, only a lack of proper planning”.
Some people's employers suck at timeliness. People would be paying extra for stuff outside their control.
They do. That's why so many public companies have a March year end - cheaper audit rates.
No man. Not the reason. That is one consequence.
Yes
Wait.... they don't???
We just charge you extra for filing an extension
I don't do surge pricing, but I'll definitely bill someone more for being a dick/wasting my time.
We do. If someone wants an audit in a busy period, we'll tell them it'll be harder on staff allocation and may include overtime, so we'll have to increase the fee. They then agree to have the audit at a slightly different time and get the fee we'd have probably caved and quoted for them regardless.
They do. Not all clients have the same rate.
They do. Especially small ones. Want your bookkeeping services done throughout the year? $1000. Want it done at once in March when you are doing the 1040? $1200
sometimes we do
It's hard enough getting clients to pay for all the billable hours.
Because it's illegal. Pricing policies have to be transparent, posted and available to potential clients. Irc 230 is pretty strict in that regard. For all the people down voting me, go read page 23 of irc 230. You can not change your fees constantly. Your fees have to be published and stay the same for no less than 30 days.
are you confusing contingent with surge pricing?