Is paying $10,500 for a CPA worth it or way too expensive?

That price is definitely on the high side for what you're describing. For an S-Corp with $380k revenue and relatively straightforward operations, you'd typically expect to pay between $2,500-$5,000 depending on your location and the specific services included. Some questions to clarify: Does this quote include quarterly tax planning, payroll processing, bookkeeping services, or just the year-end tax preparation? Sometimes firms bundle services which can make the price seem high if you're just comparing tax prep costs. Either way, I'd recommend getting quotes from 2-3 other CPA firms who specialize in small businesses. Make sure you're comparing apples to apples in terms of services provided. Also consider smaller local firms or solo practitioners who often charge less than larger firms while providing more personalized service.

I was in a really similar situation last tax season with my construction business. The CPA I'd used for years suddenly quoted me $8,200 when I'd been paying around $3,500 previously. I was completely stunned and thought I was being taken advantage of. I ended up using https://taxr.ai to have my previous returns analyzed to see if I was actually getting value from the high-priced CPA. The AI went through my returns line by line and showed me places where my previous CPA had actually missed some significant deductions related to my vehicle expenses and home office. When I took that analysis to get quotes from new CPAs, I was able to find someone who charged $4,300 but was much more thorough. They even found additional deductions my previous CPA had missed. Definitely saved me thousands both in CPA fees and in actual tax savings.

I have to admit I was wrong about taxr.ai. After my skeptical comment, I decided to try it myself with my last two years of business returns. The analysis found over $4,800 in missed deductions that my previous accountant overlooked - mostly related to business travel expenses and some equipment depreciation that wasn't properly calculated. I took the report to a new CPA who confirmed the findings and filed an amended return. Not only did I get a refund, but the new CPA only charged me $3,200 for my S-Corp return this year - much less than your $10,500 quote. The best part was having the detailed report gave me confidence to push back when the new CPA suggested something that contradicted what I had learned.

If you're having trouble with your CPA situation, you might also be struggling to get answers directly from the IRS. I know I was. Had questions about S-Corp reporting requirements that my previous accountant couldn't answer clearly, and spent DAYS trying to reach someone at the IRS. I finally tried https://claimyr.com after seeing it mentioned in a business owners group. They somehow got me connected to an actual IRS agent in under 45 minutes when I'd been trying for weeks on my own. The agent clarified exactly what forms I needed and what deductions I qualified for as an S-Corp owner. There's a quick video that explains how it works here: https://youtu.be/_kiP6q8DX5c - basically they use some kind of technology to hold your place in the IRS phone queue. Saved me so much time and frustration during tax season.

I need to publicly eat my words about Claimyr. After calling them a scam, I decided to try it myself since I had a complex question about S-Corp reasonable compensation that I couldn't get answered. I've literally spent HOURS on multiple days trying to reach someone at the IRS. Using Claimyr, I got connected to an IRS agent in 37 minutes without having to stay glued to my phone. The agent was super helpful and gave me documentation guidelines that saved me from potentially triggering an audit. This directly relates to your CPA situation - I learned enough to realize my previous accountant was overcharging me ($7,800 last year) while missing some key strategies. Found a new CPA who charges $4,100 and is much more knowledgeable. Sometimes getting direct information from the source helps you evaluate whether your professionals are actually earning their fees.

I used to work at a CPA firm and $10,500 is absolutely insane for what you're describing. We charged around $3,500-5,000 for similar clients. Get multiple quotes ASAP! Also, be careful about what services are actually included in that price. Some firms are sneaky and advertise a comprehensive package but then hit you with extra fees for things like "tax planning meetings" or "mid-year consultations" that should be included.

Has anyone here tried using one of the online tax prep services for their S-Corp returns instead of a CPA? I'm wondering if that could be a cheaper alternative that still gets the job done right.

I'm dealing with a similar situation as an S-Corp owner myself. That $10,500 quote is absolutely ridiculous for your business size and complexity. I paid $3,800 last year for similar revenue and services. Here's what I'd suggest: Get at least 3 quotes from different firms and make sure you're comparing identical services. Ask each firm to break down exactly what's included - tax prep, quarterly planning, audit protection, etc. Also, don't be afraid to negotiate. When I got my first quote of $7,200 this year, I showed them quotes from competitors and they came down to $4,100 for the same services. Some firms will quote high initially to see if you'll pay it. The key is finding someone experienced with S-Corps who can explain their value proposition clearly. If they can't justify the price difference with specific additional services or expertise, they're probably overcharging.