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EITC Procedures You Currently Use


Philip1117

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You keep believing that. Let me know, when the compliance auditor visits, how that line of thinking works for him/her.

Everyone should read/see some of the seminars that Karen Hawkins, Director of Tax Preparer Compliance for the IRS, puts on and listen to how she is directing her department to do things.

A couple of years back I went to the annual IRS seminar....and I got so "upset' I was ready to call it quits. Rules...rules....rules....

I wasn't the only one.....everyone I spoke to felt that way.

I do what's best. I do what's logical. I follow the rules as best I can. But I can't worry about every return. When that day comes....I'll call it quits.

It's a very sad state if the IRS uses resources on someone like me....who does less than 10 EITC returns/year....for anything other than just not allowing the credit.

Part of Karen Hawkins job is to scare everyone. She seems to be doing it well.

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>>> A couple of years back I went to the annual IRS seminar....and I got so "upset' I was ready to call it quits. Rules...rules....rules....

Get used to it Friend! It will get even worse as time goes on. I know 2 preparers who called it quits because they could not keep up with the changing laws and complexity. I purchased the clients of one of them.

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MsTabbyKats, looks like we have all been attending the same IRS pep talk seminars. I will not be turned into a government law enforcement officer until they put me on their payroll. I am an income tax preparer. Over the past years, something is shifting in their treatment of our profession.

We are now working under constant threat of severe penalties, suspension of our PTIN, and disgrace. Since the sophistication of computer technology, the tax laws have become so crazy, that even professionals will arrive at different outcomes when preparing the exact same tax return. Sometimes we are at the mercy of the quality of the tax prep software that we purchase.

We have an adversarial relationship with the IRS and now our clients.

I can remember when kids didn't have SS numbers; I prepared returns with a pencil and calculator; i had a wall of reference books with weekly replacement pages sent to keep them updated;I would call the IRS help centers and their answers were usually flat out wrong. And it was all kinda fun.

I did fewer returns, but made more money per return. To be profitable today, we must operate like a factory.

Don't get me wrong, we still find ways to have fun, enjoy our clients and take pride in our work. It helps to have a network of peers who understand the pressure and offer real solutions to problem situations. That's what I find here.

I will continue to fight the good fight. Bring it on!

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As I had said before if you do not due at least 150 EITC returns you have no major worries.They want only the people who actually take care of the child receiving EITC.I told many of the clients who could not provide birth cetificates to go to court and adopt the child or go to family services and have the child placed with them.I will see if they return this year if they followed thru.I am in Oxon Hill which borders SE DC where unemployment is over 25%.

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I have one location and a home office.We did 1750 returns last year down from almost 2300 the year before.The JHW store 5 doors from me does the same verification.It is built into their software.The HRB is 3 miles away not much compettition.Two Instant Tax that were my biggest problems are now out of business but may open under differen names.They did pay stub returns for years.

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>> Two Instant Tax that were my biggest problems are now out of business but may open under differen names.They did pay stub returns for years.

http://www.abc2news.com/dpp/news/local_news/investigations/no-more-tax-prep-for-instant-tax-service-after-fed-ruling

If they open up under a different name but same players you would think IRS would investigate them? Also their clients may be on the IRS radar for audits?

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Part of Karen Hawkins job is to scare everyone. She seems to be doing it well.

Fear has always been one the agency's most important tools. And that's been a boon to our business, though we are not usually as blatant as the HRB ads. Good or bad it's a part of our professional environment and we need strategies for it the same as we do for IRS timetables. I still follow the ethic I learned at Block 20 years ago, that audits are a normal part of the tax system and our clients in particular have the advantage of professional representation.

In this thread I have tried to focus on eligibility issues because truth is still one of the best defenses. I have a balanced caseload, and don't worry much about IRS targeting. If I had a lot of EIC family relationships would get more attention, just as I would look more closely at compensation if I did a lot of pass-through entities, or housing if I specialized in clergy.

Karen Hawkins does not scare ME (maybe if I went to her seminar....) If she's good at her job, fine. I think many preparers should be scared of her, and I expect and support increased oversight. [Which reminds me--I gotta renew my PTIN.)

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MsTabbyKats, looks like we have all been attending the same IRS pep talk seminars. I will not be turned into a government law enforcement officer until they put me on their payroll. I am an income tax preparer. Over the past years, something is shifting in their treatment of our profession.

We are now working under constant threat of severe penalties, suspension of our PTIN, and disgrace. Since the sophistication of computer technology, the tax laws have become so crazy, that even professionals will arrive at different outcomes when preparing the exact same tax return. Sometimes we are at the mercy of the quality of the tax prep software that we purchase.

We have an adversarial relationship with the IRS and now our clients.

I can remember when kids didn't have SS numbers; I prepared returns with a pencil and calculator; i had a wall of reference books with weekly replacement pages sent to keep them updated;I would call the IRS help centers and their answers were usually flat out wrong. And it was all kinda fun.

I did fewer returns, but made more money per return. To be profitable today, we must operate like a factory.

Don't get me wrong, we still find ways to have fun, enjoy our clients and take pride in our work. It helps to have a network of peers who understand the pressure and offer real solutions to problem situations. That's what I find here.

I will continue to fight the good fight. Bring it on!

This was good, my thoughts exactly. Just ask questions, document and you have done your part. Ta-da. Put me on the government payroll and I will make every client take a lie detector test!

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>> Two Instant Tax that were my biggest problems are now out of business but may open under differen names.They did pay stub returns for years.

http://www.abc2news.com/dpp/news/local_news/investigations/no-more-tax-prep-for-instant-tax-service-after-fed-ruling

If they open up under a different name but same players you would think IRS would investigate them? Also their clients may be on the IRS radar for audits?

I suspect until real punishment exists there will always be that sort of office. Whether it's the same people or not. How many years did it take for the IRS to take them down after they started working on it? And the punishment is what, they can't do taxes anymore? So, make big profits for many years filing fraudulent returns and then get punished by not being allowed to prepare returns? Like they would have been preparing returns if they couldn't do it fraudulently anyway?

Whether the IRS audits clients of fraudulent preparers is a good question. Does the IRS notice when one ERO is submitting a bunch of bad returns and flag all the returns for review, or does it look at the taxpayers individually and they have no higher audit risk? I'd hope the former, but I fear not.

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They already have the client list. They match PTIN numbers to tax returns. I was told this by an agent several years ago.

That is what I thought too, they should be able to match EFIN, PTIN and SS# on all filed returns, but I think they also grab your records to see if perhaps you have been paper filing with bogus PTIN or no PTIN as in Turbo Tax Preparer.

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That is what I thought too, they should be able to match EFIN, PTIN and SS# on all filed returns, but I think they also grab your records to see if perhaps you have been paper filing with bogus PTIN or no PTIN as in Turbo Tax Preparer.

This is really the problem.

The IRS is having the largest problem not with "Paid" preparers, but with "unpaid" buy the TurboTax box and prepare as many returns as you can until TurboTax quits accepting them from that box, and go buy another one.

I'm sorry, the problem isn't in those folks with a PTIN. Its in the folks who DON"T HAVE TO HAVE THEM, and are preparing fraudulent returns.

And I am TIRED of being compared to CROOKS.

Kim Hawkins can kiss my ass. She needs to use her resources to go against those who are commiting CRIMES, not searching around in my files for a missing birth certificate.... Which, I can tell you, I haven't a single one in my files.

/rant off.

Rich

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I can't stop the crooks using Turbo Tax to file fraudulent returns, but each time i pick up a new customer and find they had used that method previously, I offer to amend it when I find that it was inaccurate. I will charge $50 per return and show them where the mistakes were made. One time I amended 3 years and got them a few bucks more in refund (than my fees)! I have even amended where they had to pay a balance due and interest because they wanted to come out clean.

Generally the clients are impressed and they value your relationship.

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I can't stop the crooks using Turbo Tax to file fraudulent returns, but each time i pick up a new customer and find they had used that method previously, I offer to amend it when I find that it was inaccurate. I will charge $50 per return and show them where the mistakes were made. One time I amended 3 years and got them a few bucks more in refund (than my fees)! I have even amended where they had to pay a balance due and interest because they wanted to come out clean.

Generally the clients are impressed and they value your relationship.

I find the opposite. When I get a client that had one of those returns previously....and I tell them I will not deduct their cruise, or new car, or ring....they get upset. I only remember one time when the client wanted me to amend and do a legit return.

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Not every client I offer to amend goes along with my recommendation, but I do show them the difference in interest and penalties if the amend it year 1 vs. yr 3. Those CP 2000 are usually 2 yr behind if you get caught!

Most of the mistakes that I routinely see from Turbo Tax preparers in my area is their preference to do a standard return, where an itemized return will benefit the taxpayer. I remember one family where the mortgage interest and RE taxes were more than the standard deduction and this went along for over 3 years.

The other credits they miss are the Savers credit and dependent care. And a few they missed the $250 educator's deduction.

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Not every client I offer to amend goes along with my recommendation, but I do show them the difference in interest and penalties if the amend it year 1 vs. yr 3. Those CP 2000 are usually 2 yr behind if you get caught!

Most of the mistakes that I routinely see from Turbo Tax preparers in my area is their preference to do a standard return, where an itemized return will benefit the taxpayer. I remember one family where the mortgage interest and RE taxes were more than the standard deduction and this went along for over 3 years.

The other credits they miss are the Savers credit and dependent care. And a few they missed the $250 educator's deduction.

Omg....I get things like a $10,000 deduction for vehicle expenses....when the person doesn't even own a car! (Not to mention a job that could not ever require travel). And they want to know why I won't do it the same way. Amending isn't even an option (but I do tell them that if they don't, they will get a nasty letter down the road ).

Sometimes a new client may have missed things on a self-prepared return.....and they do amend prior years.

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Not unless the taxpayer wants to cooperate. I only had one situation where the taxpayer wanted to pursue because his residential energy credits for a solar system was recaptured (He was a renter). We still do not know what fine if any the unauthorized preparer paid!

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Several years back I looked over a return (gratis) for a new employee of a client. The guy had previously worked as an independent contractor driving a taxi provided by a cab company. He paid for fuel and split the fares with the owner. The previous preparer had deducted the standard mileage allowance and had also taken a FUEL TAX CREDIT on the return.

When I advised the he should amend and how much he would owe, he decided to get another opinion. Never saw him again, and nver heard if the return was ever audited.

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Does anybody try to get the name of the TT preparers to report them?

Report who? Someone charged them big bucks to have the return prepared but at the end of the day, the return was "self prepared". Also, they know the preparer by Salomon and that's all the info they have.

People who go to these places to have their taxes prepared, go there precisely because that's the kind of preparer they like. As soon as I see a return self prepared and they mention a famous guy in DC (now in MD), I tell them. I doubt you will hire me to prepare your taxes because you are used to preparers that don't do a good job. I don't waste much time with them and most of the time I recommend HR block.

I honestly like to get clients from HR block because I can charge my "new client" fees without any discounts.

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