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small business taxes /
small business payroll /
small business accounting

What Are Additional Charges in a Monthly Accounting or Payroll Proposal?

February 24th, 2022 | 14 min. read

By CSI Accounting Staff

Signing a contract of any kind is already nerve-wracking, so unclear wording can add just enough uncertainty to make anybody walk away. We get it - “additional charges may apply” isn’t exactly the most detailed sentence ever written. 

Even if you already know what the cost of monthly accounting will be, you should have the full picture of what’s included in the fee before you move forward. After working with small businesses for a handful of decades, we know that owners want both a short, concise contract and the option to view full details for additional charges at will.

Our proposals clearly list the services that are not included, but we would like to offer a more detailed explanation of:

  • What they are
  • Why they aren’t included in the quoted price
  • How much they cost*

*Please note that prices are subject to change over time. Updated pricing will be laid out in formal proposals.

Additional Charges For Accounting

Different accounting providers vary the definition of what “accounting services” include. Take a look at CSI’s services, what we don’t include in our monthly fee, and the price of monthly accounting. For the most part, these are additional services that we can provide, but they would cost extra. To explain further, here are the points specifically listed under the accounting section of our proposals:

Census Bureau Reports

We can do Census Bureau reports for a charge of $300 since they are not related to taxes or financial information and therefore fall outside the scope of the services we offer. Otherwise, we’ll help you find the information you need in order to provide the reports to your administrator at no charge.

Responding to IRS and State Notices

If the notice is for a period that we did the work, as opposed to a different accounting service provider, we don’t charge anything. However, if it’s for a period that we didn’t do the work, we charge for the time spent looking into and fixing the issue. Tax issues can be very time-consuming, and the time spent researching the issues and resolving them could have been used in generating revenue instead.

Talking With Lawyers or Going to Court on a Client's Behalf

This can happen for a variety of reasons, but it doesn’t happen very often! Generally, when an attorney is involved, there is going to be research for us to help with. This takes time away from servicing our other clients, and going to court also pulls us away from our workload. Fees vary depending on time spent.

Annual Filings With Secretary of State

Once per year, you need to file to re-register your business to keep it in good standing with the state. They are not required to file tax returns, prepare monthly financials, or provide advice. Therefore, this is a process completely unrelated to the normal scope of work we perform. We can do this for you with an additional fee of $95 per year; in fact, most of our clients have us perform this service.

Late Reporting Fees

If you report your payroll later than expected or make changes after it’s been processed, it involves a lot of last-minute communication via phone calls and emails. It can throw off our schedule and disrupt our workflow, so we charge an additional fee for late reporting or late changes.

Buying or Selling a Business or Building

This is not a common course of business. It involves larger, more time-consuming processes that require a different skill set to complete. It often involves gathering, researching, and performing proforma analysis, so we bill for our extra time and effort spent here. We can assist with various parts of this process, from helping with getting loans, to working with different tax rates in selling inventory, land, and buildings. We can be a trusted advisor in this area of business.

Entity Formation and Filings

Different types of entity formation have different amounts of work involved. A complicated partnership or corporation formation is best handled by an attorney, while filing for an S-Corporation election can be handled by CSI as an additional service with an additional fee. These involve understanding the ownership structure, operations, and who is the responsible party.

Loan Procurement Assistance

This involves lengthy conversations with the loan officer. Our relationship is with the client, and outreach to other parties requires additional effort. Procuring a loan can be a lengthy, complicated process, so we charge for our time.

Carrying Back a Net Operating Loss​

We don’t charge if you carry a net operating loss forward. However, if you carry it back, we would need to amend or rework prior tax returns that have already been completed. Doing this to prior year tax returns is outside the scope of our services - unless the need to do so was due to an error on our part. We charge $500 if we did that prior year’s return, otherwise it is $1,000 if someone else did the return.

Additional Charges For Payroll

Different payroll providers also vary what “payroll services” cover. This is another reason to take a look at CSI’s services, as well as the price of payroll. Here are the points specifically listed under the payroll section of our proposals:

Setting Up Tax Accounts in Additional States

When you start a business or hire employees in a new state, there are tax registrations that need to be completed in order to get the appropriate payroll taxes paid. You can do these yourself, but you may want to have your accountant, attorney, or payroll provider do them so you know that they’re done correctly. Many payroll providers won’t do state tax registrations, but CSI does as an additional service with an additional fee, starting at $195 per registration.

Ongoing Payroll & Tax Compliance For Additional States

Some businesses have employees in multiple states.  When this happens, there are additional tax filings that need to be filed on a monthly, quarterly, or annual basis to keep you in compliance with each state. There may also be additional rules in those states that you need to be aware of, such as mandatory sick leave, minimum wage, and per diem rates. The fees vary depending on the number of taxes in each state and the payroll frequency.

New Hire Reporting

You’re required to report new hires to their respective states. To keep you in compliance, we report all newly hired employees to the necessary state. The charge for reporting each new hire is $7.45.

Direct Deposit Payments to HSA/FSA Accounts

You may offer pre-tax employees benefits for health care costs that include a payroll deduction. If we are responsible for reporting FSA deduction amounts or funding an HSA account, the additional work will carry an additional fee of $9.95 per pay.

Child Support and Other Garnishments

You may be required to withhold pay from employees for child support or other wage garnishments. These are required to be in compliance, so we process these payments. The fee for child support is $4.95 each, and other garnishments are $9.95 each.

Retirement Plan Reporting

You may offer retirement plans for your employees that include a company match. If we are responsible for reporting the employee and employer contributions to the plan administrator, the additional work will trigger an additional fee of $9.95 per pay.

Rush Fees and Late Changes After Processing is Complete

If you report your payroll later than expected or make changes after it’s been processed, we need to put in extra time and potentially incur additional fees. It can throw off our schedule and disrupt our workflow, so we charge an additional fee of $50 for late reporting or late changes.

Amending Quarterly Payroll Tax Returns and Unemployment Tax Returns

We don’t charge for any mistakes on our part. When the error is from a period prior to us doing the work or caused by someone else and the quarterly payroll tax returns need to be amended, the cost starts at a minimum of $255 per quarter.

Year End W-2 and 1099's

These are done for every employee and independent contractor who has worked at your business in a year. We need to verify all information at the end of the year. Since this falls outside of our typical activities per pay cycle, we charge $195 as a base fee, plus $9.95 per employee.

Amending W-2 Forms

This would occur if something was done wrong in a previous year. We do not charge for our errors. If it is not our fault, we charge a $50 base fee plus $9.95 for each W2.

Human Resource Services

This is an optional, additional service. We partner with Mineral HR to offer three tiers of service. The three tiers cost $10, $50, and $450, respectively.

Employee Timekeeping Services

Not everybody needs this, so it’s not part of the standard package. We incur costs for this, so we charge extra. We use SwipeClock, which can often include a physical timeclock for $100, plus setup and activation fees. We generally charge $5 per active employee per month; however, different options carry different price points.

PTO Tracking

This is shown directly on the paystub for your employees. Tracking these hours is more work for us, so we charge $1.95 per employee per pay period.

Manual Tax Payments

If your tax payment(s) get returned by your bank for any reason, we delete the file and schedule the tax payments manually. Since this requires additional work for us, we charge $4.95 per payment.

Check Printing & Report Printing

We ideally want to be paperless, so we prefer our clients use direct deposit and electronic reports. We do not charge for these, and we don’t charge if you print checks on your end. If you still prefer to have us print checks and/or reports, we will for an additional charge $10 per payroll for each. We also deliver and pass on the postage and courier charges to you.

Employee Verifications

These are required for certain things, such as if one of your employees wants to buy a house.  Lenders require a credit check and a completed Verification of Employment (VOE). We can do this paperwork for the VOE  for a $35 fee.

NSF and Bounced Direct Deposit Fees

The fees on these vary depending on which payments bounce and whether we have to pull back payments from the employees.  If only the direct deposit amount bounces, that carries a $100 fee. 

Know Exactly What the Extras Will Cost

No one wants to get a pricing proposal and still not fully understand which services they would be paying extra for. Here at CSI, we are as transparent as possible when it comes to cost, but there still may be some special considerations to address when it comes to your exact needs. 

The list above will help give you an idea of what the price is for services outside of our standard monthly accounting fee. But because these are variable, it's best to speak with us to get the full details.

Now you should have the confidence to schedule a free consultation or request a free payroll proposal, if you haven’t already!

CSI Accounting Staff

This article was composed by a member of our staff who interviewed our experts to get the facts straight. Any uncited information found here came straight from a knowledgeable accountant or payroll specialist.