Book a call
Outsourced Tax Preparation

Outsourced tax preparation – seasonal capacity for CPA firms and businesses.

Tax preparation through dedicated offshore tax preparers: 1040, 1065, 1120, 1120-S, 990, state returns. For CPA firms adding busy-season capacity and businesses with complex multi-entity returns. Typical cost $2,200–$3,800/month during season, or hourly at $22–$38/hour.

Scope tax preparation capacity →

Scope

Returns our tax preparers handle

Form 1040 individual returnsFederal and all-state individual returns. Schedule C, Schedule E, Schedule F, K-1 flow-through, foreign income reporting.
Form 1065 partnershipsPartnership returns, K-1 preparation, basis tracking, §754 elections, partnership agreement analysis.
Form 1120 C-corp returnsCorporate returns, multi-state apportionment, Schedule M-3, consolidated returns, NOL carryforward tracking.
Form 1120-S S-corp returnsS-corp returns, shareholder K-1, reasonable compensation analysis, built-in gains tracking.
Form 990 nonprofits990, 990-EZ, 990-PF returns. UBIT analysis, state registration renewals, public support test calculation.
Multi-state returns50-state nexus analysis, apportionment, state-specific credits and incentives, composite returns.
International filingsForm 5471, 5472, 8865, FBAR, FATCA, GILTI, Subpart F inclusions, treaty-based positions.
Extensions & estimated taxesForm 4868, 7004 extensions. Quarterly estimated tax calculations, safe harbor analysis.
Tax research supportResearch memos on specific positions, code section analysis, case law review, authority-weighted conclusions.
Review-ready deliverablesReturns delivered ready for partner/reviewer sign-off, not raw drafts. Workpapers, source documents, and positions documented.
Platforms

Tax platforms our preparers work in

Dedicated experience across the major US tax software:

  • UltraTax CS (Thomson Reuters) – deep experience, most common in mid-market CPA firms
  • Lacerte & ProConnect (Intuit) – for smaller CPA firms and solo practitioners
  • Drake Tax – strong small-firm penetration
  • CCH Axcess Tax & ProSystem fx (Wolters Kluwer) – larger firms and complex entities
  • TaxWise, ATX, TaxAct Professional – smaller-firm platforms
  • GoSystem Tax RS (Thomson Reuters) – enterprise-scale firms

Related pages: UltraTax page, Lacerte/ProConnect page, Drake Tax page, CCH Axcess page.

Two engagement models

Two ways to engage outsourced tax preparation

Model 1: Seasonal dedicated preparers (most common for CPA firms)

CPA firm engages 2–8 offshore tax preparers from January 15 through April 30 (core tax season). They work as extension of the firm's tax team: receiving work through the firm's workflow system, preparing returns, submitting for US-licensed partner review. Firm provides engagement letters, client communication, final sign-off.

Economics: typical dedicated senior tax preparer $2,400–$3,600/month during season; covers 40–80 returns per preparer per season depending on complexity. For a firm adding 4 seasonal preparers, total seasonal cost $9,600–$14,400/month for ~160–320 additional returns absorbed. At average firm return pricing of $600–$1,800, the revenue-to-cost ratio is 8–35x, depending on return mix.

Model 2: Per-return outsourcing

CPA firm sends specific returns for preparation, paid by return complexity. Typical ranges:

  • Simple 1040 (Schedule A only): $45–$85 per return
  • Complex 1040 (Schedule C, E, multi-state): $125–$300 per return
  • Partnership 1065: $250–$650 per return
  • S-corp or C-corp: $350–$950 per return
  • Nonprofit 990: $400–$1,200 per return
  • Complex multi-entity or international: $650–$2,500+ per return

Per-return pricing works for firms with variable volume or firms that want to test offshore preparation without a seasonal commitment. Dedicated preparers typically cost less per return once volume exceeds ~40 returns per preparer.

Which model when: CPA firms doing 200+ returns annually typically benefit from dedicated preparers. Firms doing under 100 returns, or with highly variable volume, typically benefit from per-return pricing. Firms between 100–200 returns can model both and pick based on year-over-year predictability.
Compliance

IRS §7216 and Circular 230 compliance

Outsourced tax preparation has specific compliance requirements beyond standard accounting outsourcing:

IRS §7216 written client consent

§7216 prohibits tax return preparers from disclosing tax return information to third parties (including offshore preparers) without written client consent. §301.7216-3 specifies the required format: separate document from engagement letter, specific language including disclosure of offshore preparer, retention requirements.

Our engagements include standard §7216 consent templates. Our §7216 consent template is the baseline document. For firms using per-return outsourcing, consent typically added to client engagement paperwork before sending returns offshore.

Circular 230 practitioner obligations

Circular 230 §10.35 covers reasonable reliance on third-party work. Using offshore preparers doesn't diminish firm obligations; firm remains responsible for accuracy, due diligence, and client communication. Offshore preparers support but don't substitute for US-licensed practitioner responsibility. See our Circular 230 guide.

AICPA §1.150.040 disclosure

AICPA Code of Professional Conduct requires disclosure to clients that third-party providers may be used. Standard engagement letter addendum handles this. See our §1.150.040 disclosure template.

State CPA board requirements

Some states have specific disclosure requirements for offshore tax preparation. California, Texas, Illinois are most specific. See state-by-state matrix.

Related

Related services & resources

Service

Offshore Tax Preparation

Same service, offshore-specific framing.
Audience

For CPA Firms

CPA firm-specific service page and economics.
Guide

Tax Season Capacity Playbook

Operational guide for adding offshore capacity for tax season.

Add tax season capacity in 3 weeks.

Book my call →