Jack from Ohio Posted December 30, 2014 Report Share Posted December 30, 2014 Okay, here is what I finally sent. Thanks to all for your input. I don't know how this will play out. Thank you for the check received, #6306, in partial payment for invoice #1458, copy enclosed. I appreciate your note regarding my ‘usual charge,’ however there is no such thing. As my engagement letters and cover letters clearly state,.... .... Best regards now and in the New Year, Much too cushy and nice. State the facts clearly and concisely without all the "fluff." She will either pay you or not. Either way, you should fire her. Your letter should include the fact that you won't have time for her this coming tax season. She is leeching on you. You need to stop enabling her to do that. Quote Link to comment Share on other sites More sharing options...
Margaret CPA in OH Posted December 30, 2014 Author Report Share Posted December 30, 2014 Jack, I guess I am just cushier and nicer than you. I purposely included the "fluff" for this client but not for all. You don't know the entire back story and I won't bore all here with it. I do not expect full payment but I do expect to continue to see her in social situations. It will not be difficult to sever this client relationship from my end if she doesn't from her choice sooner.Thanks again for your input. I thought long and hard about this as well as rereading the many thoughtful responses above. In the end, we each must act according to our own understanding and needs. I did so. You very well would have handled this in another matter if you had ever even gotten to this stage with a client - which I doubt.I am satisfied and will be with whatever the outcome. I don't think I burned any bridges or created an enemy, just lost a client and can live with that. 7 Quote Link to comment Share on other sites More sharing options...
jklcpa Posted December 30, 2014 Report Share Posted December 30, 2014 Margaret, it seemed well thought out, covered all of your points, and was professional while keeping a polite tone. Well done! Quote Link to comment Share on other sites More sharing options...
Patrick Michael Posted December 30, 2014 Report Share Posted December 30, 2014 Much too cushy and nice. State the facts clearly and concisely without all the "fluff." She will either pay you or not. Either way, you should fire her. Your letter should include the fact that you won't have time for her this coming tax season. She is leeching on you. You need to stop enabling her to do that. I agree with Jack. The more "fluff"you put in the letter, the more she has to object to and argue over. Quote Link to comment Share on other sites More sharing options...
JohnH Posted December 30, 2014 Report Share Posted December 30, 2014 Margaret: I think your letter was very thoughtful and professional. I have clients to whom I'd write a letter like that if necessary, but I also have clients to whom I'd simply say "Get Lost!" if that's what was required to make my point. A professional practice is not a cookie-cutter enterprise where everyone is treated exactly alike. The essence of good business practice is knowing when to make distinctions, and a qualified business manager understands this nuance . I trust your judgement that this was the way you needed to handle this situation. Nice job. 7 Quote Link to comment Share on other sites More sharing options...
MsTabbyKats Posted December 30, 2014 Report Share Posted December 30, 2014 Margaret- I'm with you. Recoup whatever you can....and for this coming season (if she comes to you) explain that your time is limited and that she needs to "have it all" before you start. At times I feel that I'm "my clients shrink" ...because I'm a humanist. Many people are cut and dry....only seeing the numbers. 1 Quote Link to comment Share on other sites More sharing options...
RitaB Posted December 30, 2014 Report Share Posted December 30, 2014 A professional practice is not a cookie-cutter enterprise where everyone is treated exactly alike. The essence of good business practice is knowing when to make distinctions, and a qualified business manager understands this nuance . I trust your judgement that this was the way you needed to handle this situation. Nice job. Totally agree with this. There are old bats that I choose to treat "fluffily," because, oh dear God, they need it. They are not running over you if you lay down in front of the bus. It's more like a rough massage. And no skid marks. Many times I benefit when they send family. Or bring me a nice jar of apple butter and a hug cause, let's face it, they are bats, and nobody else pays attention to them. Other times I just get a rough massage. Run your business the way you see fit. 5 Quote Link to comment Share on other sites More sharing options...
David W Ristau CPA Posted December 31, 2014 Report Share Posted December 31, 2014 Well done Margaret. Long term friend/client relationships can be a real minefield to walk through for difficult issues. I think your response stated as facts the items which comprise your invoice. For next year consider adding interest to late payers' balances. Quote Link to comment Share on other sites More sharing options...
GeneInAlabama Posted December 31, 2014 Report Share Posted December 31, 2014 >>For next year consider adding interest to late payers' balances.<< What is the maximum interest and late fee that we can charge? Or is that determined by each state? Seems like the interest would not be enough to be a deterrent, but maybe a hefty late fee might do the trick. Quote Link to comment Share on other sites More sharing options...
JohnH Posted December 31, 2014 Report Share Posted December 31, 2014 You have to be careful with this interest/late fee stuff. This is a consumer issue and some states have very harsh laws regarding minor infractions of consumer-protection laws. If you slip up, and the client happens to stumble upon a young lawyer who wants to make a name for himself/herself, you could be on the losing end of an expensive legal threat. I'd ccertianly run any interest/late fee policy past an E&O carrier before implementing it. Personally, I just offer them early payment discounts when I anticipate potntial payment problems (or just demand payment up front in rare cases) - no interest or late charges involved. Quote Link to comment Share on other sites More sharing options...
David W Ristau CPA Posted December 31, 2014 Report Share Posted December 31, 2014 I used to charge 2% per month (24% APR) for invoices over 60 days outstanding. In 2015 I'm shortening the time to 30 days outstanding. If credit card companies can charge 29% on their credit cards, (which is what's stated in some of the monthly statements I receive) then I'm sure I'm well within reason charging 2% a month. I'm not a bank. Nor is anyone else on this forum. I've learned the hard way that some people will pay it and some won't. Those that don't pay it are either one-time customers or no longer a customer. QuickBooks makes it easy to assess, prepare and print finance charge invoices and monthly statements. Starting in 2015 I'm also sending any account at 120 days to a collection agency and dropping the client if there isn't a payment plan in place with us. Enough is enough..... 2 Quote Link to comment Share on other sites More sharing options...
B. Jani Posted December 31, 2014 Report Share Posted December 31, 2014 I personally believe that NO explanation necessary about our work. This open up the can of worm and some consumer protection depends upon state. If the customer does not appreciate what we do then I would not keep them as client. I have always increased the fee for PITA clients. If they stay I make more, if don't I am happy.Jack always says that once you fool me is my mistake, twice..............Just my two cents! Quote Link to comment Share on other sites More sharing options...
GeneInAlabama Posted December 31, 2014 Report Share Posted December 31, 2014 Thanks JohnH. I have never looked into it because it has never really been a problem. I have toyed with the idea, but never gave it a lot of thought. On the few that I have lost money on, I just felt that they needed it more than I do. Quote Link to comment Share on other sites More sharing options...
Jack from Ohio Posted January 1, 2015 Report Share Posted January 1, 2015 2% per month will not get you into any trouble with State. Be sure that your invoice states that the 2% will be charged and then follow through. You will be amazed how 2% actually charged will motivate people to pay you. Quote Link to comment Share on other sites More sharing options...
WITAXLADY Posted January 2, 2015 Report Share Posted January 2, 2015 funny - not, we were just discussing - no one is going out without paying this year! We do feecollect and those people have refunds but do not want to spend the extra $15 - so I will raise their bill $10 more and give them a split the difference... - Quote Link to comment Share on other sites More sharing options...
mcb39 Posted January 7, 2015 Report Share Posted January 7, 2015 Totally agree with this. There are old bats that I choose to treat "fluffily," because, oh dear God, they need it. They are not running over you if you lay down in front of the bus. It's more like a rough massage. And no skid marks. Many times I benefit when they send family. Or bring me a nice jar of apple butter and a hug cause, let's face it, they are bats, and nobody else pays attention to them. Other times I just get a rough massage. Run your business the way you see fit. No two businesses are alike. Being a sole practitioner, as many of us are, changes the playing field. We need to make decisions based on our own feelings as opposed to the "corporate rules". I have only ever fired one client and it was a difficult decision to make. It was difficult because it was a relative of a close relative. However, once I made the decision and followed through, the relief was, and still is, tremendous. The time I wasted on that one client has been well filled by several other respectful and good clients. In the case of non-payers; they get one chance. If they don't pay, they don't get tax prep the following year. The few times that has happened; they were ready and willing to pay up in full rather than have to find another tax preparer. Generally, they will pay for the prior year and prepay for the current year. None of these situations are going to make or break me. I get to play by MY rules; right or wrong. And so does Margaret. 3 Quote Link to comment Share on other sites More sharing options...
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