rfassett Posted May 11, 2013 Report Share Posted May 11, 2013 I don't know what you can say, but I think you need to re-think your fee structure. Does $20 cover your trouble? It is only trouble if you are not properly compensated for your work. Years ago I had a similiar situation. Day trader client receives a corrected 1099 long after the return was done. He was a rather long time client, paid timely, but a genuine PITA. Taking the higher road, I charged him $50 to re-do the return. I determined that was the break even point for that amended return. He balked. I said pay whatever you think it is worth. He sent me a check for half. I sent it back to him with a note stating that he clearly did not value my services and I thank him to not darken my doorway again. He called when he got the check and note to try to reconcile and apologize. I told him my statement stands and that was the last I have seen or heard from him. Well, actually, he called again a couple weeks later but I never returned the call. I made the commitment then, it is my job to teach my clients to respect me. They will not respect me for being cheap. I have never again discounted that sort of situation. And i have not lost a client because of it. 4 Quote Link to comment Share on other sites More sharing options...
mcb39 Posted May 11, 2013 Report Share Posted May 11, 2013 I had only one tax prep client not come back this year, and I suspected she was a one time return from the get go. She came because of installation of a $30K geothermal heat system, the kind that required excavating a significant part of her back yard. She'd previously called HRB and was told that it wasn't eligible for any credit at all. She'd actually done all the research and had the exact model printed out from the websites to match her original invoice before she ever came in. She made my job on that return an easy one. I suspect she went back to preparing the return herself, but she was also happy with my services and may return in future when the returns become more complex with the changes that are coming. I had almost the identical client, except that mine was long-term. She was so well prepared on the Geothermal info that I only had to enter the numbers. She has a carry-forward credit Quote Link to comment Share on other sites More sharing options...
jklcpa Posted May 11, 2013 Report Share Posted May 11, 2013 Update. I was not home last evening, but my client stopped by with an envelope with the 1099-R and a $20 bill and a sticky note. Hope this covers your trouble sorry! Now what can I say?? Clients don't understand what it takes to put together even the easiest of amended returns, and it's up to us to educate them if we want to get paid. When I have these easy amendments that are no fault of my own, I explain to the client that even though making the correction itself within the program is not that time consuming, I don't work for free and that my time is worth something, that there is simply a certain amount of other time required. Clients seem to think because we can plunk one number into the return to correct it, that that's all there is to it. Explain to them about the time to review the corrected return to make sure that other numbers haven't changed due to threshold limitations, that it takes more time to put a paper returns together with whatever is your customary practice (instructions, envelopes, sign here stickers), and that you have the documentation that is required for your files. Then there's also the state return to be corrected. For something easy to correct like this, it can take less than 5 minutes to fix in the program and 4 or 5 times that for the rest of the handling. I usually end by telling them that its easier to prepare a complete and accurate original return through e-file than it is to amend it later. By the time I get finished my explanation them, they agree to pay without any further questions... probably just to get me to shut up and get it over with. lol For something this seemingly simple, I'd probably charge $50. In your case, I'd call or email. "Sorry I missed you last night when you stopped by, but here's what's involved with that amendment and how much I charge for that type of work.... How would you like me to proceed? Leave it up to them to make the decision to pay you. Then it's their decision, not you forcing it on them. 2 Quote Link to comment Share on other sites More sharing options...
Guest Taxed Posted May 11, 2013 Report Share Posted May 11, 2013 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! Quote Link to comment Share on other sites More sharing options...
mcb39 Posted May 11, 2013 Report Share Posted May 11, 2013 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. They ALWAYS blame it on the bank. I ALWAYS ask them why they didn't call me first. 2 Quote Link to comment Share on other sites More sharing options...
kcjenkins Posted May 11, 2013 Report Share Posted May 11, 2013 Tell her this. "The amount the bank takes out, unless you ask them to take out more, is only the amount of the PENALTY for early withdrawal, because that is the only amount they know you will have to pay. You may or may not, depending on the other items in your return, also owe income tax on the amount, but how much will depend on your tax bracket, which depends on everything else in your return. Also, in some states, you may owe state income tax on the withdrawal." 1 Quote Link to comment Share on other sites More sharing options...
Jack from Ohio Posted May 12, 2013 Report Share Posted May 12, 2013 I despise financial people that tell the client... "We took THE taxes out of the withdrawal." I tell all my clients that if they are thinking of making a money transaction of over $1K, to call me and talk about possible tax consequences. Only 5% that need to call me ever do. For the other 95%... "If you had followed my directions and called me, this surprise would not have happened. Consider my words in the future." 1 Quote Link to comment Share on other sites More sharing options...
Guest Taxed Posted May 12, 2013 Report Share Posted May 12, 2013 I am almost certain that the bank will show my client the standard IRA withdrawal form and the standard disclosures. And I bet there is a signature on that form. She has no chance of winning this with the bank. I told her so, let her prove me wrong! You are right very few of our clients actually call us before they decide to take a distribution from a qualified plan. I hope this family will not make this mistake again. Quote Link to comment Share on other sites More sharing options...
MsTabbyKats Posted May 12, 2013 Report Share Posted May 12, 2013 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 1 Quote Link to comment Share on other sites More sharing options...
Guest Taxed Posted May 12, 2013 Report Share Posted May 12, 2013 In my early days i used to have walk in traffic and i would get taxpayers shopping for the biggest refund at the lowest price! The typical response would be so and so said you could do that or another accountant said i can claim that etc. My standard response was well then why have you come to me? Silence followed..... I have since stopped all walk-in and my practice is by referral only and i am getting better each year selecting cases that I think will be relatively problem free for a few years. I will not take a case that is under audit because I am not a CPA or EA and I used to have a relationship with a local EA that I referred many cases but he has since retired and moved to the sunshine state! Quote Link to comment Share on other sites More sharing options...
kcjenkins Posted May 13, 2013 Report Share Posted May 13, 2013 What state are you in? Quote Link to comment Share on other sites More sharing options...
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