Finally somebody agrees with me

[ILLMAS]

A new client called me about her tax return, she wanted to know when she should send out my payment, if it was okay to send the payment when her refund comes in, I told her I expect to get paid when you receive the goods and not when the refunds comes in, I also mention to her that I really hate calling people to remind them that they owe for services and not only that I think it's embarrassing too, she agreed and said she feels embarrassed when they call her too.

[Terry D EA]

I did this very thing for a new client this year. I am now hoping that I don't regret my decision. I have never done it in the past but tried to give this tax payer a break. This is what happens when your heart gets in the way of business.

[RitaB]

I did this very thing for a new client this year. I am now hoping that I don't regret my decision. I have never done it in the past but tried to give this tax payer a break. This is what happens when your heart gets in the way of business.

I have them leave me a check, which I hold until they get refund. I do that a lot, actually.

[michaelmars]

I have no problem with clients paying me a bit late but my invoices call for $25 late fee plus 18%interest., that's a real motivator.

[ILLMAS]

I am going to confess, I now regret saying that to her

[HV Ken]

We use the Fee Collect service for this. Works great and we get paid right out of their refund. Highly recommend it.

[RitaB]

I am going to confess, I now regret saying that to her

Hey, Friday, I was terrible to a client. He's a computer programmer who just doesn't have time to pay his bills or do taxes, apparently. When he picked up 2012 in December, I let him out of here without paying, been doing his return for years, not worried. Well, when he dropped off 2013, I reminded him he hadn't paid for 2012. Then, when he picked up 2013 he said, "Hey, that's a better refund than I thought," and was about to leave without paying.

I said, "Yeah, it's awesome, but you haven't paid for 2012 or 2013, and I'm not in business to make friends, so pay up."

He laughed till he was crying. Whew, I was glad, cause I just opened my mouth and that rolled out. No filter whatsoever.

[joanmcq]

One reason I take credit cards!

I have one longtime client I let pay when the refund comes in. They live across the street, and have never needed reminding. Her kids I won't do anymore, and I told her they didn't pay last year. She was furious!

[Crank]

I always require payment before the returns are filed. Ive offered credit cards for three years now and no one has ever used it.

[Jack from Ohio]

No pay, no return. I use FeeCollect too. Only lost out once in 10 years when the IRS grabbed the entire refund for delinquent Student loans.

I now despise "injured spouse" forms. The way people use it does not fit my definition of being married. (rant over)

[HV Ken]

One reason I take credit cards!

I should amend my previous post - Fee Collect if client has a refund, and credit cards if client owes.

We also do not file a return without first having payment.

[michaelmars]

I should amend my previous post - Fee Collect if client has a refund, and credit cards if client owes.

We also do not file a return without first having payment.

but then you to have see them again after you do the return and deal with all their questions. I mail out the returns with a bill, I only got burnt 3 times or so in over 24 years but they were one shot deals when I had a store front. Only one long time client burnt me but he had so much other stuff going on in his life I actually did him 3 years without getting pay till I cut him off.

[HV Ken]

but then you have see them again after you do the return and deal with all their questions. I mail out the returns with a bill, I only got burnt 3 times or so in over 24 years but they were one shot deals when I had a store front. Only one long time client burnt me but he had so much other stuff going on in his life I actually did him 3 years without getting pay till I cut him off.

Yes, this is our model. We close out all tax returns with our clients. When they sign the return, it says:

Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and belief, they are true, correct, and complete.

I personally would not sign that without going over the contents with the person who prepared it, so this is our approach with our clients. Yes it takes longer, but we believe it is the right thing to do. I also recognize we are in the vast minority of tax professionals by adopting this practice.

[Janitor Bob]

Just this week I received a check in the mail from a client whos taxes I did this time last year. She did not pay then and moved from Ohio to Florida...So I figured I'd seen the last of her and that I would never see that payment. Surprise! Check in the mail with an apology note. She also gets points for being smart enough to move from Ohio to Florida.

[Carolbeck]

I have them leave me a check, which I hold until they get refund. I do that a lot, actually.

Me too. I have always done this for most of my clients. Except it seems this year I have been chasing a lot more. Some of these people make a great deal more $$$ than I ever will. Just very frustrating when I know I do not charge a lot. Then there is the expectation of a 1 to 2 day turn around when they know I work full time during the day elsewhere. The ones I have had to chase are the same ones that hound me to have the "next Day" delivery. So I feel obligated! I used to be able to do this when I only had 40 - 50 clients. At 166 and working 12 hour days elsewhere, there is no way I can turn the returns around that quickly.

It is going to be very different next year, I am writing on each clients folder that I have to chase (again), "No Return Before Payment". I have had to do this only to a few in the past, next year there will be many!

[Pacun]

I have two clients who never have money to pay me but the day their refund hits their banks, I get a desperation call from them asking me where I am because they want to pay.

The first year they paid while in the office but the second year they started paying me when they get the refund and they have done it for about 6 years.

The first year they didn't have any money to pay us, my partner was going to start a sermon and I immediately said "No problem, you can pay us when you receive your money". That was the best sentence I have ever used and now I have at least 10 clients coming from referals from these clients.

Honestly, I trust all my clients. If I don't trust them, then I cannot prepare their taxes, correct?

[mcb39]

I lowered the "pay before filing" boom this year and you would think the world had come to an end. I have always had a few clients who consistently have me hold their checks and I know who they are and I know they will call me as soon as their check hits the bank. As for the others, they have the option of going elsewhere, but so far none of them have. I just don't need that kind of aggravation at this time in my life. I have more new clients coming in than I know what to do with. The greatest majority of clients have no payment issues. However, do the rest of you find that close friends and relatives are the very worst and they get the largest discounts. Go figure!!!

[Yardley CPA]

I am a one man shop and efile returns after receiving the signed 8879 forms. Once the returns are accepted, I prepare a packet of information including a copy of the individual returns, client letter, summary and comparison and mail everything to the client along with my invoice included. I also place a self-addressed stamped envelope in the packet for them to send payment back to me. Much like MichaelMars, I've only been burnt once in 20 years. It's worked well for me.

[RitaB]

Well, I gotta say, I don't file until the client has had their copy for 24 hours at least. Stuff happens.

Also a one man shop, so to speak, but if I mailed the returns with a SASE, most of my clients would still come in to pay. Don't ask me why.

[Yardley CPA]

Rita...you're right on target. Most of my intereaction now takes place through email. I still have a good number of folks who stop in to see me personally but the majority is through email. I send my clients a copy of the final return through a secure pdf. I ask them to review it and to let me know if there are any questions or concerns. Included in the email are copies of the respective 8879 forms with instructions to print the 8879's sign and return them to me. Once I receive the signed forms, I normally wait at least until the next day to efile. Just want to allow for a bit of a cushion in the event anything "pops-up."

[Pacun]

Yesterday we were talking about this with my partner.

We had a client who paid about 40% and then said that he was going to pay us the rest on "Monday" (maybe he will come back). My partner said "We lost that money and we worked for nothing". I said, "not really", "we already covered our fixed and variable expenses so that 40% is enough and it is a profit". I explained to her that we already have the knowledge, the computer, the software and that 40% was plenty for the time we worked.

I went on and said we have 10 clients who don't have money to pay us but they are smart enough to stick with us and not go to HR block and their fees deducted from their refunds (no RALs in my office). Even if 1 of them don't come back to pay us, we are still ahead on the game. Sometimes, you have to read between the lines!

[Richcpaman]

Just had this issue this past week.

T/P with 2012 return.

I made four appointments with him, that he broke, to get the 2012 return done.

Now, he wants to redo the mortgage with the bank.

Now he is hot for the 2012 return to be completed.

Phone message after a week: "Rich can you send me the return! I need it!"

I get it done, create the bill, and have my office manager call him and leave a message: "The return is complete, the fee is $360 and Rich needs a credit card number"

He calls me back the next day... "Rich what's up with that?"

"I get paid at time of service, not when its convienent, what the numbers?"

And then I sent the return info out.

Screw em.

Rich

[Lion EA]

Was it someone on this board that said, "If I'm going to work for free, I'll take the time off instead."?

[Cathy]

I used to hold certain clients checks until the refunds clear their account as a courtesy, but it quickly became expected of me even with clients with six figure income. The year I started charging an extra $25 for this service, the clients who really needed the service didn't mind a bit and it was still cheaper than getting a rapid refund or"payday" loan. Then there were those clients who while once needed the service, their income has increased over the years to where they could easily afford to pay their fee without my holding their checks. However, once I started charging the fee, they would tell me to go ahead and deposit their checks by all means! My fee is going up to $35 next year as it is a lot of work and stress thinking I might deposit their checks too soon.

I tried fee collect last year but it's not worth the extra work plus record keeping....then it costs me rather than my getting paid for my time and trouble. Then there are those few that seem to think it's their right to mail me a check "as soon as they get home." They are the ones who forget to bring their checkbook, debit card and/or credit card each year, and, without fail until I mail them a second notice, I don't get paid. Won't happen this hear because when I e-file a return I sign the return based on being the PAID preparer, and cannot do so until I have been paid,.....and will cite being reminded of such at an IRS seminar this past year......sounds logical anyway!

I've had a sign posted in my office for years that states in an effort to keep my fees at a minimum, no returns will be released until my fees are paid. Guess I need to hold a reading comprehension class prior to tax season.

[Crank]

Comments in this thread are really pushing me to reduce the number and time of face to face interaction I have with clients. That is my biggest problem!

Most clients will drop off their info, we discuss over the phone and get more information if required and then they just pick up. However, I do have about 20% that insist on a drop off meeting to "explain and review tax documents" and then also want an "exit meeting" to review the final return. Each meeting eats up about an hour of my time which is non-productive and could be used to work on returns.