Tax Refund

[JRS]

It only took seven months, but we finally got our refund.  No letters or anything and thanks for the interest!

[Jim Oh Bkkr]

Had one of these!  Less than 2 weeks after e-file (3/14), client received (DD) an odd amount - not an even dollar amount.  Early August, they received an additional "odd amount" (Total was, within reason, the refund amount plus interest).  I was never able to get to the PPL, nor was the client able to contact the IRS.  

No explanation whatsoever!

[mcb39]

Crazy how they are sending out these checks with no explanation.  The clients are in a state of confusion and we don't have any answers, only guesses.

[JohnH]

Is the exact amount really important?  As long as the client receives more than the refund claimed on the return, and the excess is reasonably close to the amount expected when interest is added, I tell them to deposit the check. I don't understand why some checks will show the interest in a small notation on the lower-left while other checks don't, but it isn't worth the trouble to inquire. 

 

[Lion EA]

But even if you were expecting $1,000 but received $600 and $400, and especially if you were expecting $1,000 but received 567.89 and $443.21 (or even $421.13) one or both of those checks might NOT be part of your refund. Maybe ID theft or a different year or a SSN typo at the IRS or... Granted, IF the interest is noted, that implies that it's somebody's refund. At the very least, the client will blame us for telling them the wrong refund amount.

[Lee B]

I had several instances 3 years ago both federal and state where I had to recalculate the interest amounts in order to explain to my clients their refunds,

due to no explanation from either the IRS or the ODR. In these cases my interest calculations were within one dollar of what my clients received.

[Lee B]

Lion,  we being accountants are used to being precise.

Given the stressful conditions the IRS and other governmental agencies are dealing with, "reasonably close"  may be all we can expect.

 

[Lion EA]

I do tell my client's that it's close enough for government work, those that I think will appreciate how broken our government is when it comes to taxes. But there are clients that demand to know why I "did something wrong."  

[Lee B]

1 hour ago, Lion EA said:

I do tell my client's that it's close enough for government work, those that I think will appreciate how broken our government is when it comes to taxes. But there are clients that demand to know why I "did something wrong."  

All we can do is admit that we're not perfect and we make mistakes too.

[Terry D EA]

"All we can do is admit that we're not perfect and we make mistakes too."

The above says it all. Some clients are understanding, and some are not. I don't think we'll ever get past the mindset that it is automatically assumed the taxing authorities are correct and we have made a mistake. More often than not, that is not the case. My primary state has been NC for 25+years and I can tell you they are worse than the IRS at giving explanations. I've been actively looking into whom to contact at the administrative level of the NC DOR to voice my concerns regarding how we as professionals are treated by some of the agents, the unwillingness to provide documentation to the professional and the client, the automatic collection letters without prior notice or the opportunity to dispute anything. My ongoing question is how am I, as an Enrolled Agent supposed to properly represent my client when I cannot receive copies of any notices or detailed explanations surrounding the notice or collection action. Every time I ask, I'm told the same thing, "we only provide copies of notices or other correspondence to the taxpayer". Great, but for the most part, they don't resend anything. These responses can add to the client's deception that we don't know what we're doing.

Yesterday, I spoke with a very nice and cooperative lady at the NC DOR practitioner priority line, every explanation was "what the system" has done. Also, stated, I see "the system" issued a check in the amount of ****** but not sure why "the system" did that. We finally got to a figure that was owed we agreed upon, took notice the client's 2021 refund was absorbed to cover what was owed and the check was the difference between the refund portion and interest and penalties. Here's the kicker, I said there should be a penalty abatement for aggravation and confusion from the NC DOR, and she said well, "I can eliminate that penalty right now and your client will receive another check in the amount of *****." Now I'm a hero and we all know what my status will change to if none of this is followed through.  

[Lion EA]

But when I compute that the return was correct, and my software computes the return the same way, but the IRS (or state) refunds a different amount or sends a balance due notice with NO explanation of how they arrived at their amounts, I do NOT want to say I made a mistake. I want the IRS to send an explanation the way they used to. They are NOT sending letters recently, just different refund amounts with no explanations or balance due notices with no explanations. I am only human and do make mistakes, but I want to learn from my mistakes, want to know what I did wrong. I do NOT want to admit to someone else's mistakes!

[mcb39]

I have a client who just received his 2019 refund; which was supposed to have been applied to 2020.  We prepared 2020 with that  amount being applied.  Now,  what happens when they process 2020 which has an amount applied to 2021.  I just filed 2021 last week because he is SE and always the last return through the gate.  Again, he has a refund because of the (new, last year) EIC.  How many years is it going to take them to figure this one out.  

It all started with a CP2000 with a bill because they claimed he had never filed in 2019,  I could and had to prove that he had definitely filed and had a refund applied.  That information undoubtedly got  added to that pile of 8 million pieces of correspondence that never was opened.  I'm not going to continue, but you all get the idea.  If we let this stuff bother us, we will all lose our minds.  Let them figure it out....someday.

Edited October 25, 2022 by mcb39
wrong year typed

[Lee B]

Yes, the IRS and the state DORs make too many mistakes and when they do we can explain the situation to our clients.

I remember 5 or 6 years ago I obtained a $35 refund for a client from Oregon, no fee to my client since they are one of my larger monthly writeup/payroll/tax clients.

Today, it's unlikely that I would do that. Today, I would explain to my client that it would be an exercise in futility.

For a larger amount, let's say more than $200, I would try, but I would tell my client that it will take a long time and it's uncertain if they will get the refund.

[JohnH]

On 10/25/2022 at 12:32 PM, Lion EA said:

But when I compute that the return was correct, and my software computes the return the same way, but the IRS (or state) refunds a different amount or sends a balance due notice with NO explanation of how they arrived at their amounts, I do NOT want to say I made a mistake. I want the IRS to send an explanation the way they used to. They are NOT sending letters recently, just different refund amounts with no explanations or balance due notices with no explanations. I am only human and do make mistakes, but I want to learn from my mistakes, want to know what I did wrong. I do NOT want to admit to someone else's mistakes!

Some people like to learn from other peoples' mistakes. 

Others learn from their own mistakes.

I seem to be different. I often learn from my own mistakes... by repeating them.