MsTabbyKats

OK...listen to this:

Taxpayer:

2011

On the "Wage & Income Statement"

1. W-2

2. Tuition

On return...the tuition was a deduction...because it was for an MBA to improve his skills. He was already working in the field and had a bachelors.

Auditor:

Somehow adds a $25,000 scholarship to income ....and says MBA was for minimum requirements of job (although taxpayer submitted a letter from employer stating it wasn't)

My question to you:

1. Is there a supervisory auditor? (I mean...the agent cannot just decide to add in a scholarship from a prior year that was used directly by the school to cover tuition...not a penny was given to the client...from 2010!)

2. Time for the taxpayer advocate?

3. Any other thoughts?

Also...the auditor is not familiar with what an MBA is.

I haven't spoken to the auditor yet (waiting for POA to be posted).

I'm never going to stop working. But, just as I do now....on my own terms.

Call me stupid...but what exactly is a "resller"?

Is this what TRX had been for the programs we got (until this year)?

Gee...I'm surprised at a $19 dividend could generate such a mess. If a client gets something this small "after the fact" I generally say something like "You can pay me to amend the return....or you can wait until the IRS catches it, and pay them "whatever"...which would be less than my fee."

I think I'm going to change my policy and amend........

Not gone....I just spoke to the sales dept. Refund policy is 30 days....and also by "first day of tax season" (whatever that means!).

Crank, I don't know why you're having a problem getting the refund. Did you use the program at all?

They are back....

Last week their website was down. I tried a couple of times. Tried calling and no answer??

I wonder how many users would renew with them??

Probably no renewals....and I'd be shocked if they stayed in business with the same name.

I'm surprised I didn't read about class action lawsuits.

I had to "reorganize"...and had an excuse to cut back (I keep promising myself to do this every year...I really didn't care about making less because I had a lot less stress)....but lots of people ended up losing money.

Hmmm....trxsoftware.com seems "functional" to me. I can get free shipping if I order today! I clicked on buy...and it directed me to payment method.

I still don't see where you did a part-year NYC return?

You said he lived in NYC for 3 months! You won't get caught because his W-2 didn't indicate that he was a NYC res....but it's supposed to be included.

It's on the way.

I have to tell you...I don't like NY/NJ combo returns...when there's a move. They can get complicated.

Let me know if you have any questions.......

I just sent the states...I assume the federal was easy.

BTW...His W-2 is wrong. It says the entire income is taxable to NJ. It isn't.

And i just noticed NYC is involved!

Since I have nothing better to do...if you want to send me your e-mail I'll do a dummy for you.

Let's see:

He had to pay tax to NY while he lived in NJ. NJ should be giving him a credit for the tax he paid to NY.

While he lived in NY....he worked in NY.....so he didn't owe NJ anything for that period.

He should be filing a NJ Res return...for the period he lived in NJ.

He should be filing the IT-203 for NY. (Assuming NYC/Yonkers isn't involved). He should pay NY tax on the entire income (part of the year he was as NR...and then he was a Res). The tax he pays on the income while a NR is the tax you use as the credit for NJ.

I think you missed Slippery's point. I think he's saying that if you prepare the estimate forms, you have given them the ability to do what is needed. That is your CYA, and puts the responsibility solidly on the client.

Good point!

I'm going to prepare for the next 3 payments and send them to her.

Stop offering and just prepare them.

And, should I pay them too?

No...I'm just going to "read everyone the riot act" before I start the return.....let them know my expectations and limitations. If they can't handle it...then they can find another preparer.

If the $700 was in Box 7....I'd amend the return to add a C...and take expenses.

It's easier to deal with now than get a nastygram in 2 years.

I have a feeling MsTabbyKats does not want to turn into a "Professor of Taxation". She won't be able to charge enough from these clients for her time and efforts!

Exactly!

I'm not about "making more money". I'm about a stress free season...and a reasonable income.

The residency issue is a NYC thing...lots of people work here who don't live here. And lots of employers don't withhold correctly. It's complicated...especially when people live with "the current girlfriend" for a month, and then move on to a new one. He's currently unemployed....I wouldn't charge him more. Just...don't insult me...and commit beforehand to "where you live".

I can't just dump the PdD in economics...as I do a few of her relatives. She's not American, recently divorced and I suspect sends money home. I just gotta get her to trust that I am doing the best for her situation.

I know about "raising rates". I dumped a few this year by raising rates. And "you have to pay in advance" seems to work also. One guy I told "not to come because I wouldn't let him in". I'm pretty good with the obvious and obnoxious ways to do this.

I guess what I'm looking for is "how to keep someone you'd rather dump...but let them know they have to play by your rules or they will be dumped".

We all have them...the clients you want to fire...but, for some reason...they keep coming back.

I'm just looking to see how others handle this and maybe get ideas!

I have 2 this year that stuck like glue.

1. After the return was done...got obnoxious to me...about "residency issue". (Which has been resolved to the way it was filed.)

My plan for him: When he calls I will tell him to put it in writing...in an e-mail...his residency address and his mailing address...and that I can no longer go by the statements he gives me.

2. A woman who has multiple jobs, some of them on 1099-Misc, with inadequate withholding....and then expects me to "teach her the tax laws" so that she can understand why she owes money, but her brother-in-law, who is married with 2 kids and has one job on a W-2 and makes the same total income gets a refund. (She's a PhD in economics!!!)

My plan for her: The day she contacts me I'll tell her to give me her income statements, and list her expenses. I'll do the return based on her expenses, but I will not answer any "tax theory" questions. In addition...I will remind her that for 2 years I offered to make Estimated Vouchers...so if she owes money it's because she didn't listen to my advice. If she can't agree to this...I can't do the return.

Anyone else have plans to avoid the pain.........

But wait there is more...

I finished the amendment last night (took me 20 minutes) and called her this morning with the bad news! She owes around $700 more in balance due. The 1099-R was a code 1 and she thought the bank promised her that they took out enough taxes so that she would not have to pay anymore. Now she wants to take a copy of the 1040X and fight with the bank! I advised her the bank is not responsible to calculate your tax liability. They just do the mandatory witholding or whatever rate you requested.

It is going to be very interesting what the bank says to her??

Needless to say that the news spoiled her mother's day weekend!

How many times have I heard...."Oh...no. That can't be. The bank took out for taxes."

(Really...the same thing if someone has 2 jobs!)

I have a saying (applicable only to cut & dry returns):

Have someone else do your return...and based on the same information you gave me....if there is on penny difference I'll give you your money back.

Never had to give a refund

Hmmm...I lose a lot because most of my clients are foreign, and go home.

But I get more referrals than ones I lose.

This year I limited new clients based on my laziness. I just didn't want to get involved in ones that required research (too time consuming for my low fees).

I fired a couple. One guy asked me if I was still in the same place (my apt)...and I told him "yes"...but if you come I won't let you in.

I'm from the TRX crowd. And I would never go back to them...even for free.

In the course of life, is $300 with a 21.2% return worth potential headaches?

I think you are over analyzing this.

But, if you take it, do you know their refund policy? Is it in writing?

Maybe they will find new suckers, but I wonder what % of their current clientele will be back?

Mike-

I didn't get an offer either. (Used them for 4 years)

I put in for a credit on my charge card on 1/26....and they never questioned it.

I also complained to the BBB...and was offered a refund because of this.

They probably have deleted us from their master list.

Good

Oh...and did I mention every state has different rules also. Some go by the fed govt....some don't care about the treaty. And, some...have different criteria for each visa. So, I have to call every state (except for NY...because luckily we are a federally conformant state...which means everything the IRS allows...the state allows.)

The good news is that they become resident aliens.....so they can file regular 1040s.

Not everyone with an accent is a non-resident alien. (That's funny. Just about everyone here has an accent. I have an ethnic look...and in every neighborhood they speak to me in "the local language". Greek, Spanish, Russian...whatever). But not every "non-resident alien" needs a 1040-NR.

This is why my head used to spin. And this is why I had a stress free season this year.

LOL...if you look at my roster...out of about 300 returns....maybe 30 are for people born here.

Non resident aliens! Do you practice in NYC or NJ? Honestly i have yet to do a non-resident alien. What are the main differences. i know they need form 1040NR. Are some of the deductions limited or higher tax rate?

I used to get a NYC resident who moved there from VT send me his return and it was a real pain to do the NYC return. What got me is that i was charging him VT rates and it would have cost him around $250 for Federal, NYC and NY return. No wonder he would FedEx the stuff to me.

Yep...NYC!

But, my clients are from all over the world...and live all over the country.

There are two major differences...besides using a different form that has to go in on paper:

1. Every country has a different treaty...with different rules for different visas....and I like to get it right...so I was constantly calling the "advanced tax law" dept at IRS to go over and confirm every treaty...because some of them are kind of hazy (does 2 years mean 2 calendar years...or 2 years from date of arrival???etc.)

2. You have to itemize (except students on an F-1 from India)

So...you get a guy from Pakistan who hears his will make $35,000 with his PhD in advanced molecular physics...and thinks...wow...lots of money. Well, in NYC...even for a single person that's just a little over poverty. But, this guy has a wife and a child. So...he really has "no cash to spare". Then you ask him "What were your job expenses?"...and he has none. So, you start counting paper clips.

BTW...I charged something like $125 for this...which is a real joke (work out of my home...no overhead...and very sympathetic). HRB would probably be $300.

Like just about everyone here.....the season started off in chaos.

Luckily I decided to jump ship from TRX really early on......and went back to my prior software, TaxAct.

The bad:

1. TaxAct didn't support non-resident aliens...which had been a large part of my buisness

2. I had to re-enter all the "prior data" for everyone......rather time consuming

So, I decided early that I wouldn't accept new non-resident aliens (unless they were simple), that my fee for non-resident aliens I had done previously would have to go up, that I wouldn't accept new clients "with issues" and that I wouldn't do any "past headaches".

In other words....I wasn't up for "the challenge".

Maybe I lost 20 jobs...but my actual income didn't suffer.

The bottom line was that I had (a lot) less stress.

TaxAct is a great program, very user friendly.

When you have a problem with a plan....it forces you to find a solution. And...the solution can be better than the original plan.

Thank you TRX!

I hate hate hate cold weather (wind, snow, ice) so tax prep is a perfect excuse for me to not go out. Every year...I'm a bear who awakes from hibernation.

This year was different since I purposely cut back, so I did have a "quasi-life"....but I always felt that I had to rush back.

Tuesday....I can go out and relax....without worrying about a ton of calls/e-mails waiting.