For a straightforward return — W-2 income, standard or simple itemized deductions — a registered tax preparer is usually all you need, at a friendlier price. A CPA (or an enrolled agent) earns the premium when your taxes stop being a form and start being a situation: self-employment or business ownership, rental property, equity compensation, multi-state income, or anything involving the IRS beyond filing. California adds its own rule: anyone paid to prepare returns here must be a CTEC-registered preparer, CPA, enrolled agent, or attorney.
Who's who
Registered tax preparer (CTEC) — completed state-required tax education and registers annually with California's tax-preparer council. Right fit for standard personal returns.
Enrolled agent (EA) — federally licensed by the IRS specifically for tax; can represent you before the IRS. Often the sweet spot for complex personal and small-business tax at below-CPA prices.
CPA — state-licensed accountant with education, exam, and experience requirements. Beyond tax prep: planning, business accounting, financial statements, and IRS representation.
What it typically costs
Situation
Typical range
Simple W-2 return (federal + CA)
$150–$400
Itemized / a few extras (stock sales, childcare)
$250–$500
Self-employed / Schedule C
$400–$800
Rentals, multi-state, equity comp
$500–$1,200+
Business returns (S-corp, partnership)
$800–$2,500+
Prices vary widely by market and complexity — treat these as calibration, not quotes. A preparer who asks lots of questions about your year is a good sign; one who promises a big refund before seeing your documents is a red flag.
Choose by situation, not title
W-2, maybe a house: registered preparer or quality software.
Freelance or side business: EA or CPA — quarterly estimates and deduction strategy usually pay for themselves.
Rental property or equity compensation: EA or CPA with that specific experience — ask directly.
IRS letters, audits, back taxes: EA, CPA, or tax attorney — you want representation rights, not just preparation.
Frequently asked questions
Is a CPA worth it for simple taxes?
Usually not — a registered preparer or good software handles a W-2 return at a fraction of the cost. CPAs earn their fee when your situation involves business income, rentals, equity, multiple states, or planning questions.
Who is legally allowed to prepare taxes for pay in California?
California requires paid preparers to be CTEC-registered, or a CPA, enrolled agent, or attorney. Anyone charging for tax prep without one of those credentials is operating illegally — check before you hand over documents.
What is the difference between a CPA and an enrolled agent?
An EA is federally licensed specifically in tax and can represent you before the IRS; a CPA is a state-licensed accountant with a broader scope including audits and financial statements. For pure tax work, a good EA often matches a CPA at a lower price.
What should I bring to a tax preparer?
Photo ID, Social Security numbers for everyone on the return, all income forms (W-2s, 1099s), deduction records, last year’s return, and any IRS or FTB letters. A complete folder saves you billable back-and-forth.
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