Double check (Marketing Tool)

[ILLMAS]

I want your honest answer please, have you ever done a double check on a prior year and found you can get that person more money back?

 

 

[Lion EA]

I have.  Looked at three years for a new client and found the preparer didn't give her credit for property taxes paid in CT for two years.  $1,000 back.  She's my client now.

 

Conversely, for DIYers, I tend to find they misunderstood the law or their software and computed too small a tax liability.  I explain it to them.  They seldom accept my offer to amend.  They are not my clients now.

[Catherine]

Here in MA we have this weird "senior circuit breaker credit" that is a refundable credit for folks over 65 (that has NOTHING to do with circuit breakers).  Income limits on the thing.  Meant to be an offset for property taxes (to some extent) but includes renters and also takes into account half the water/sewer bills for the year.  Up to $1,000 per year.  LOTS of preparers miss that one.  Had an elderly lady come to me when she sold her house; I was able to get three years' back SCB credits for her.  With some other small bits of nonsense tossed in, still almost $3K in her pocket.

 

Then I had to convince Drake these were NOT taxes deducted in previous years and so not includable on the 1040 as taxable state refunds.  lol

[rfassett]

I do not use the scheme as a marketing tool but I will review prior year returns for every new client - not so much to look for more money back as to review for correctness. Some like what I find and some do not.  But it is always understood that if they are going to continue to be my client, they will go with my suggestion of a fix whichever way that may go.  I do not always recommend amending either.  It has to be significant enough to make it worthwhile - even if it is a refund. 

[kcjenkins]

I did this frequently over the years.  Never officially 'advertised' it, but did tell new clients, plus those who would tell me about a family member or friend who they think is over-paying, that I would look at the prior 3 returns, at no charge unless I found them more money by amending.  Surprising how often I did, especially self-prepared returns.  Of course, that was before the accessibility of computer prepared returns.  It was my policy, if I found a change of less than $100, since I'd already input the info, I'd still give them the return, but free.  Got a number of nice new clients that way, over the years.  

[Cathy]

Our local big box chain...won't name names, however, the local branch of the chain goes by initials...three of them........has a horrible error rate (negatively affecting their clients returns).  In fact, the errors were so outlandish years ago, I refused to take any of their clients unless on extension, and I have continued that policy since.  I tried sending a few clients back to them to get them to amend the returns, however, the chain tried to charge each taxpayer for correcting THEIR mistake(s).  

 

I had a discussion with the manager several years ago in regard to depletion allowance on royalty income.  She didn't know what I was talking about and further told me that if her computer doesn't do it automatically, taking a depletion allowance is not something she can or would do on her own.

 

For a couple of more examples:  A MFJ couple's return included Social Security income as taxable income.  "Not bad, you say?"  Not only was the disabled mother's SS income reported (which was correct), but also the SS income received under the children's SS#!

 

                                                    Another couple paid income tax on interest "earnings"......from a 1098 Mortgage Interest Statement.  The payer was listed as XYZ Mortgage Company....seems like that should have thrown up a red flag!  Never mind the amount of mortgage interest reported as income was over 10K!

 

 

I don't use the "double checking" as a marketing tool, don't have to.  I always have more of them than I care to do anyway.  I was eating supper the night their new commercial aired.  I almost choked on my food!  

Edited March 3, 2015 by Cathy

[WITAXLADY]

since I can remember (20) year! I have offered to check their last 3 or 4 - state years at no charge.. Great marketing tool - sometimes a pit tush  - takes time but has gained invaluable loyalty finding thousands of $$'s - college credits, meals, office in the home, rental income and expenses, etc. Word of mouth.

if owe - make them aware, if refund - over $40 - amend usually and I do charge a small fee even

[SFA]

If we find a mistake on a prior year return, (and we have), we tell the client and let them decide if the return should be amended. If the error is significant, and not in the clients favor, and they choose not to amend, we are prepared to drop the client.

 

Over the years, we have discovered our own errors on prior year returns.  It is a bummer to admit to the client that we have messed up, but it is the right thing to do, no matter how painful or embarrassing.

 

It's a lot more fun to find the mistakes of other tax preparers and be the hero for getting the client more money by amending!

[Lion EA]

I don't do it for marketing.  I do it to understand their tax situation, check for any carry forwards, know what to look for/what might be missing in their current year information, and to get an idea what type of person I would be dealing with if moving forward with a new client/were their returns prepared honestly, completely, etc.  Do I want this client?