Question of being Paid

[jlewis]

Curious as to how many of you extend credit for payment of returns, and under what circumstances. Maybe because they are a long time client, close friend or just ask you for additional time. If you were asked for additional time to pay, what would be your initial response?

Any comments? Thanks

 

[MsTabbyKats]

I always do......

 

Most of my work is on-line...and I e-file before getting paid.

 

If someone asks for more time....I ask them "when"....and I don't bug them until that date.

 

In doing this 20 years....I only had one who didn't pay (and he was a long time client...but he didn't get a refund that year,,,so I guess he got angry)

 

I do have one this year that I'm anticipating won't pay.

 

 

ETA....most of my clients aren't American.  Other countries take "not paying" more serious than we do here. (It's considered a crime.)  So...that may be the reason I don't have issues.  The one "non-pay" and the potential "non-pay" are both American.

Edited April 12, 2015 by MsTabbyKats

[schirallicpa]

you have to pay to pick up your returns.  you have to bring back your signed forms before i will efile.  have extended credit to "friends" in the past only to be stuck.  the only people that i will efile without money are very closely related, and i still require their forms.  even mom's.

 

for some reason these people are able to go to kmart and buy stuff when they want.  i'm sure they can pay for their tax return.

[rfassett]

We expect payment when the return is picked up or before it is mailed to the client.  Of course that does not always happen.  But we do expect payment before the return is e-filed.  Now that is not to say that we are not compassionate.  I will give my services away, if necessary, for a long time client that falls on non-self caused hard time.  An example for that - I have a long time client that has fallen on financial hard times due to drinking and gambling.  I will not do any work for him before being paid.  (In fact, just received an email from him this morning requesting services with a promise to pay. Nope.) On the other hand, I have clients that have fallen on financial hard times due to serious illnesses, for example - and I do not expect ANY payment from them.  But the run of the mill, every day client, we get paid over 95% of our fees before the return ever leaves the office.  About two a year though seem to fall through the cracks and I end up chasing their $200 for six or eight months.  That is more of a nuisance and a principle of the thing.  They do not do that to me a second time. 

[Catherine]

My engagement letter states payment in full at time of presentation of completed returns.  That said, there are always folks who forgot their checkbook (coming from work or the gym, en route to somewhere else, whatever).  Those who have credit cards - I can take those through my website or QB (higher fee from QB despite their claims not - no surprise there another Intuit lie but I digress).  Else I tell them to drop a check in the mail.  

 

Every year there are one or two that I have to remind.  If I have to remind more than a couple of times, then I "forget" to send them a letter for next year.  I don't need deadbeats.

 

The only one I kept that I had to chase for months is a lady with a high-pressure job, two little kids, and a stay at home husband who cares for the kids.  He's hopeless with money, she keeps the checkbook, and is usually too frazzled to remember her own name.  She paid up at this year's pickup for this year and last year - with a dozen apologies.  She brought her checkbook to the dropoff this year -- but it had no checks in it!  

[Jack from Ohio]

Curious as to how many of you extend credit for payment of returns, and under what circumstances. Maybe because they are a long time client, close friend or just ask you for additional time. If you were asked for additional time to pay, what would be your initial response?

Any comments? Thanks

Burned twice.  Cash, Check or Credit/Debit card.  No tickey no laundry.

 

"IN GOD WE TRUST" All others pay on delivery.

[Lion EA]

It's always signatures and payment before e-filing.  I do take all major credit cards and have a PayPal link on my website.  But, with my long-time clientele, I do make exceptions on payment when asked nicely.  Sometimes I'm too busy to get their CC info over the phone before mailing out their folder to a distant city, state, or country, so include their invoice in their mailing; I always get a check back in the mail or a contact with their CC info.  Once in a great while someone will ask me to wait to charge their card or deposit their check; those have always worked out fine.  Many of my clients came from HRB where I worked, so were used to paying at pick-up.  The only time I got stung for much, I didn't think I was going to complete the second year before I met the guy to deliver the first year; he'd brought a check for only half the first year.  He was paying me monthly for many months, but stopped; he's no longer a client.  I have a couple of small ones now; one thought Daddy paid, but Daddy stopped being my client this year.  So, I have these two to re-invoice in a week or two, but each are around $100 only.

[joanmcq]

One of the reasons I take credit cards now!

I will extend credit to some clients; hold a check until payday and I just had one ask for a max of 21 days, and I'll nudge him if I don't see it then. Some of my early clients ask to pay when they get their refunds, but they also live across the street from me, so collection is pretty easy.

[Jack from Ohio]

One of the reasons I take credit cards now!

I will extend credit to some clients; hold a check until payday and I just had one ask for a max of 21 days, and I'll nudge him if I don't see it then. Some of my early clients ask to pay when they get their refunds, but they also live across the street from me, so collection is pretty easy.

Those are the ones that burned me.  They didn't show up next year.  Try asking for those payment terms at the grocery store, your hairdresser or a restaurant.

[mrichman333]

I don't file or give a copy of the return till I'm paid

[MsTabbyKats]

Wow....I guess I'll stay with my international crowd...where if you can go to jail if you even bounce a check 

[Ringers]

I just tell my clients that I use a very good collection service.  "Bubba" pays me the client's fee up front and then I give him a copy of the client's name, address, SS#, date f birth, home phone, spouse information, banking information, etc. for him to do  thorough job on his "collections."  He must be good, because he has never asked me for a refund of the fees he pays me.

[WITAXLADY]

I used to be more lenient and have way too high and too old accounts receivable..

Now I gird my loins, tighten my belt and buckle on my armour and ask them "How will you be paying for this?"

We take check, cash, credit card or for $15 if you have a refund and a bank account we can have the fee taken right out of your refund - as long as the IRS isn't going to take your refund.  

and I have some who will give me a check to hold - but that is a pain as they never call to tell me when I can cash it... and we know when the refund comes!

 

We let them know when we get paid we will e-file their return.

 

That is a hard part of business but  no one else let's them walk...

Took me a long time to learn this and one of my staff is really good  - they are to let them know on the phone their refunds or owes, when to pick-up or sign and how much the fee is - still have people come in without checks or cash or wallets or purses!! You know you were coming here!!!

 

ps - when I first started I never worried - they always paid and a few paid the next year - then they didn't pay and didn't come back! But they had to pay that preparer,,, silly people

Edited April 12, 2015 by WITAXLADY

[rfassett]

This is how our calls for pick up go:

 

My staff:  Hello client.  Ron has completed your tax return.  Ron's fee is $XXX. Would you like to know how the return came out?

 

Client: Yes.

 

My staff. OK - Ron's fee is $XXX.  You are getting a refund (or you owe) (and then the staff runs down all the numbers and then my staff says) and Ron's fee is $XXX.

 

 

So by this time, we have impressed upon the client that the fee is important to us.  At the end of the call my staff says, Don't forget to bring Ron's check when you come to get your return.

 

Actually had one client call back this year after that dialog and asked if Ron takes cash.  Duh!

 

It is all about training the client.

 

This may come a little easier for me and my staff because my first degree was in marketing and I spent a number of years in sales before going back to school to get my master's of tax degree.  In sales, closing the deal is not an option.

[JohnH]

Most of my clients have been with me a long time, so I just include a bill when I mail their return to them. I'm not keen on sitting on returns and then having to deal with a last-minute scramble rear the deadline. When the return is finished, I want it in the mail and on the way to the client so they can sign & file it. That keeps things simple and keeps them out of my office so I can get some work done.

But even in those rare situations when I take on a new client, I still send their return with the bill. I'd like to know if I can trust them in the future. I've lost a few over the years (very few), but I think its a good way to weed out the ones I don't want to do busines with going forward. If they cheat me out of a couple of hundred dollars, they will never get the chance to cheat me out of a thousand. Of course, if i had lots of turnover I'd have to follow a different collections model.

Edited April 12, 2015 by JohnH

[Terry D EA]

<<<<That is a hard part of business but  no one else let's them walk...>>>>>>

 

I had to learn this as well and am still not good at saying pay me now. This does only apply to those long time clients who for some reason or other may be down on their luck. I am holding a check for one who has called me twice to ask me to hold it just a bit longer. That I really don't mind doing. What does irritate the heck out of me is when one of my PITA clients complains every time they get the invoice and they do have the ability to pay without question. About 6 years ago this same client told me she could get any CPA to do what I do for $25.00. I grabbed my work and handed her documents to her and told her to go find one and let me know how that works out. Well, you know the rest of the story, didn't happen and is still one of my best and largest PITA clients. I wonder if they negotiate with WalMart or the grocery store. Geez!

[HV Ken]

Cash and check always first choice!  For people with a refund, Fee Collect works great.  For people who owe and can't pay cash/check, we also take credit cards.  Our engagement letter requires payment and signed papers before e-file.  We have offered credit under extenuating circumstances.  We have also added a finance charge notice to our invoice this year for those few clients whose hardship credit request is approved.  We will never file a return in a second year when there is still an open balance from the previous year, or if there is an open balance from other services (bookkeeping, payroll, etc.).

[joanmcq]

Like I said the ones I let pay with the refund live across the street. I've also been doing their returns for over 10 years, and they've never failed to come over with cash in hand in about two weeks. I told them one of their now adult kids stiffed me the year before (for $60, an EZ) and I wouldn't have wanted to be in the room when that conversation ensued!