Conundrum (HOH/EIC)

[ILLMAS]

I don't even know where to start, TP was denied HOH, dependency exemption and EIC for 2015, we responded by submitting a couple of items on from the 886-HOH/EIC list, but was denied again because the TP had not sent a copy of the prior lease and a complete copy of the divorce decree, TP had moved and had lost her copy of the lease.  Anyway, TP said they would handle the rest since they only needed a copy of the prior lease and my help wasn't needed, in the back and forth correspondence, the TP was asked to fax them a copy of bank statements for 2015, however the statements had a different address from the address used on the tax return.  Frustrated the client return back to my office and when I called the IRS, they told me the TP case had been closed because her addresses didn't match, I asked the TP why they were different address used and the response was that any important mail is to be delivered to TP children grandmother and any non-important mail to TP home address.  Now to make things more confusing, the tax return address is the home of TP kids grandparents, however there is no relationship between the children TP is claiming, they are the grandparents of prior children TP had and grandparents have custody of those children which are not being claimed on TP tax return.  I am thinking of writing a letter on behalf of the TP to reconsider, however, this situation is so confusing I don't know if the IRS would believe it.  Your thoughts, opinion etc...  is it worth going through all this trouble

[Catherine]

Whee hah; you've got a good one here.  Shall we assume the amount that is being denied makes it worth all the trouble, AND that the client can now pay you for your time?  Cuz if they won't, stop now.  You were told once you weren't needed; nothing more should be done without payment.

All that said, if you were to take it on you would need a complete timeline etc.  Copies of decrees can be obtained from court, and a landlord should have a copy of the old lease.  An explanation of mailing address versus residential address should be acceptable.  I know plenty of people who have a separate mailing address - frequently so that mail and/or packages can be held where they won't be stolen.  They should accept that (if it's true) especially if client can show that all/most/much important mail was sent elsewhere.  A news report of mailbox vandals in the area will support the claim.

Make sure you'll get paid, make sure the full story is one you can support with documentation, if so then it may be worth your time.  But whatever you figure it's worth, double it - get paid up front as retainer with a forfeit clause in engagement letter if the client stops providing information to you.

[Max W]

The first thing that needs to be done is to find out if the IRS will reopen the case and, if so, what would be required for that.  Can it be appealed?

The only thing I can see that could be done re the address, is to get the grandmother to sign a notarized letter, which should state, that she has authorized the TP to use her address, since 20XX for receiving confidential mail and packages. 

If it gets any more complicated than that, I would refer the client to TPAS, otherwise you could get sucked into a long, time wasting nightmare.

Writing letters to the IRS without substantiating documents is a a waste of time.  

[SaraEA]

ILLMAS, are you saying the client told you your help was no longer needed and then returned because she changed her mind?  You can ask the IRS for a reconsideration (they will give you a special address to use).  On the other hand, are you sure there is no hanky panky going on here?  EIC/HOH are areas ripe for fraud, and something made the IRS pull the return and deny the benefits.  I think the landlord can give a letter that the mother and children lived in the apartment during 2015 if that is really the case.  I wouldn't mess with this for anything and agree with the others that maybe the Taxpayer Advocate should take over. 

[Max W]

I agree with Sara. There could be something nefarious going on.  

I had an EIC case several years ago. The IRS requested school records, a letter from the landlord and utility bills.

The client was perfectly legitimate,but being latino his last name and those of his wife and kids were different.  The Spanish system confuses most people in this country, as there are two last names, the first being the last name of the father, and the second the last name of the mother.  Here the father's name is considered the middle name.  I guess it confused the IRS, but that's not hard to do.

[Evan S. Golar]

What were the addresses on driver licenses and voting records?

Did the client ever provide IRS with Form 8822 - change of address?

[Catherine]

22 hours ago, Evan S. Golar said:

Did the client ever provide IRS with Form 8822 - change of address?

I have NEVER seen a client do this!  I've done it with/for a client, on occasion.  But a client, of their own volition, taking this step?!  I needed that laugh, @Evan S. Golar.

[Evan S. Golar]

I got a good laugh just reading Illmas's story. How's that?

[Edsel]

Termination of Service?  No longer needed?

Illigitimas, with me that is a one-way ticket for me to rid myself of this headache.  You'll never be able to charge enough to justify saving this client from himself.

[ILLMAS]

Thank you, everyone for your concerns, I really appreciate it   Just to clear up "my help wasn't needed", I had initially wrote a letter to the IRS and attached a copy of the documents the TP had brought in, this was in January 2017, in March 2017, TP received a letter denying it again.  I called the IRS and was told they needed a copy of the lease and a complete copy of the divorce decree, mind you this was during the busy season for me, TP said they would  just fax it to a number I was given and I had no problem with it.  I didn't hear from the TP until July 2018 to prepare 2017 and to give me an update of their case.  During the time I didn't hear from the TP, they received another deny letter and the TP called and was told to fax over bank statements, after that, TP was receiving "we are reviewing your account" letters.