Choosing S corporation status can save real money, but it comes with an extra return and stricter rules. That makes the preparation fee a real line item, and one worth understanding before you compare quotes.
These are general market ranges meant for budgeting and comparing proposals. They are not any firm's fee schedule, and your actual price depends on your records, owners, and states.
Typical price ranges
- Form 1120-S, simple single-owner, single-state: often about $800 to $1,500.
- Form 1120-S with multiple owners, rentals, or more activity: commonly $1,500 to $2,500.
- Complex entities with multi-state apportionment or several business lines: $3,000 or more.
- Owner's personal Form 1040 with the K-1: usually quoted separately, and the combined cost is the number to compare.
- Bookkeeping, payroll, and state annual reports are generally separate services.
What drives the fee
- 1Quality of the books. Clean, reconciled records are the single biggest cost lever.
- 2Number of shareholders and the K-1s that must be issued.
- 3States where you operate. Each state can add a return and its own entity-level taxes.
- 4Payroll. S corporation owners who work in the business generally must be paid reasonable compensation through payroll, and the return depends on it being right.
- 5Fixed assets, depreciation, and vehicles.
- 6Late or amended filings, which require extra review.
What a good fee should include
- Federal Form 1120-S and the K-1s for every shareholder.
- State returns for the states in scope.
- A review of shareholder basis and distributions, which affects whether distributions are taxable.
- A check that owner pay is reasonable and runs through payroll.
- E-filing, a copy of the return, and a review call.
Is the S corp still worth it?
The extra cost of preparation, payroll, and compliance is usually modest compared with the self-employment tax savings, but only above a certain profit level. Our guide to LLC vs S corp walks through the break-even. If you are already an S corp and behind on filings, read about unfiled business returns first, since late-filing penalties are charged per shareholder per month.
For fixed-fee tax preparation quoted before work begins, contact us. This article is general information, and prices vary by provider and circumstances.
