Inconsiderate Son

[ILLMAS]

You think you heard them all, today a TP brought in his two grown kids, parents provide a home, meals you name it for both of them. The son tells me he wants to do his return separate from his parents to get as much as possible, and I tell him it's better for your parents to claim you because it looks like they are going to owe. No that he wanted to do it separate from them, so the father said just do it separate. Well once I punch in the numbers, the parents were going to owe around $400 and the son was going to get about $1200 back, so I put the son back as dependent on his parents tax return and the parents would get a $900 refund and the son only $244. I presented the return as a draft to see if I can get the son to understand that the parents would benefit from claiming him, the hard headed son, didn't care, he wanted his money, so the parents are like, son we will give you the difference back, help us, and here is where I lost it. I asked the inconsiderate son, how much rent do you pay your parents, you are a grow man already, how much do you contribute to pay for food utilities, tell me, he wasn't saying anything, then the father is like you know (to the son), how I'm I going to let you do whatever you want, I already co-signed a car note for you which you never paid, I have been paying since day one, if you want to live under my roof you will do what I say. Since the son wanted to be so independent, I gave him his bill, guess what he ask his father to pay for it.

[Jack from Ohio]

I would have done the parent's return to best benefit them, then e-filed it. Gave the son back his info and let him run somewhere else and try to claim himself....

Notwithstanding, the parents in this situation have been enabling him for years, so nothing you say or do will change anything.

[Cathy]

I agree that the parents are enablers. My husband used to pull my reins many times when I wanted to "help" our sons. He told me we had to teach them "survival skills". He was right.

[Cathy]

You think you heard them all, today a TP brought in his two grown kids, parents provide a home, meals you name it for both of them. The son tells me he wants to do his return separate from his parents to get as much as possible, and I tell him it's better for your parents to claim you because it looks like they are going to owe. No that he wanted to do it separate from them, so the father said just do it separate. Well once I punch in the numbers, the parents were going to owe around $400 and the son was going to get about $1200 back, so I put the son back as dependent on his parents tax return and the parents would get a $900 refund and the son only $244. I presented the return as a draft to see if I can get the son to understand that the parents would benefit from claiming him, the hard headed son, didn't care, he wanted his money, so the parents are like, son we will give you the difference back, help us, and here is where I lost it. I asked the inconsiderate son, how much rent do you pay your parents, you are a grow man already, how much do you contribute to pay for food utilities, tell me, he wasn't saying anything, then the father is like you know (to the son), how I'm I going to let you do whatever you want, I already co-signed a car note for you which you never paid, I have been paying since day one, if you want to live under my roof you will do what I say. Since the son wanted to be so independent, I gave him his bill, guess what he ask his father to pay for it.

Had similar situation several years back. Tough situation. I refused to prepare the son's return as some one else could claim him as a dependent. Son never came back. Later that year, the "parasite" moved out of his parents' house and went somewhere else to have his returns prepared. This business is tough enough without having to deal with spoiled brats. Next.....

[jainen]

>>it's better for your parents to claim you because it looks like they are going to owe<<

Of what possible relevance is that? Either the son had more than $3650 gross income or he didn't. From your numbers, I'm guessing the son was right to insist his tax professional prepare an accurate return.

[ILLMAS]

He acted like a total BITCH and had his head up his ass.

[joanmcq]

>>it's better for your parents to claim you because it looks like they are going to owe<<

Of what possible relevance is that? Either the son had more than $3650 gross income or he didn't. From your numbers, I'm guessing the son was right to insist his tax professional prepare an accurate return.

I was wondering the same thing. There is nowhere that said he was a full time student, and to get that large of a refund I'm guessing he does't even qualify as a dependent.

[ILLMAS]

He was a full time student, he met the dependency test, parents paid his tution, parents were behind on the mortgage, mother had lost job after more then xx yrs of service and had to take a minimum wage job to survive financially, parents lost a investment property because tenants were not paying rent. I had not mention all of this before because the issue was with the son, come on you don't go to someone's office and put your leg over the chair like if you were at home and be arrogant. On sadder note google Republic Window Chicago, and read what happens to it's employees, the mother was one the victim.

[michaelmars]

>>it's better for your parents to claim you because it looks like they are going to owe<<

Of what possible relevance is that? Either the son had more than $3650 gross income or he didn't. From your numbers, I'm guessing the son was right to insist his tax professional prepare an accurate return.

AGREE, he qualifies as a dependent or he doesn't, period. I agree with the sentiments but we are doing taxes not family councelling. although, i would have charged the "kid" double what i charged the parents.

[David1980]

I'd run through the support worksheet in Pub 501 and if the kid doesn't provide over half his support, tough. Can't claim your own exemption if you can be claimed as a dependent. Doesn't matter if someone claims you or not.

[jainen]

>>I had not mention all of this before because the issue was with the son<<

I'm talking about the son. Apparently you wanted us to respond without knowing key facts, but I did say I was only guessing about the missing info. Why did you harangue him about paying rent when that had nothing to do with the return? In my opinion, the tax preparer should deal in eligibility factors, not family dynamics and certainly not a young man's posture.

So this kid is staying in school full time and holding down a job too. Most families should be so lucky! He counts on his family for basic support; like most students he does not pay rent to his own parents. Still, he doesn't feel obligated to bail out the older generation's poor investment decisions.

Well, I do agree with one thing. "You think you heard them all."

[Terry D EA]

I can see both sides of this discussion. However, I agree with Jainen on this one. It is hard sometimes watching what people do and I understand your concerns for the parents in this situation but the fact remains they came to you to get their returns prepared professionally and accurately. Got to keep the emotions out of it.

On another note, Jainen made reference to the fact the parents should be so lucky that the kid is atleast working and going to school. I agree, I work with young people every day and trust me, they are more fortunate than you think. Working at some job and going to school doesn't equal total mooch. Now I am not taking up for the kid, by your post, he does need an attitude adjustment but not from his tax preparer.

[kcjenkins]

I must admit, I'd be very tempted, in such a case, where the parents are clearly entitled to claim the son, to file their return, before doing his, and, in fact, before even talking to the son. Then, I'd transmit the return, THEN turn to the son and prepare his as the dependent he clearly is. Then tell him he can not claim himself, because he has already been claimed.

But when parents let their kids walk all over them, as this one's attitude makes clear he does, [a smart parent would pull the keys, I bet this one pays for the kid's gas, insurance, etc.] it's not our place to play family councilor. I agree with MAS that the kid SHOULD be willing to help his parents at a time of their need, given all they do for him, but no doubt they taught him to be the selfish oaf he is.

[Julie]

I seem to recall that if someone CAN be claimed as a dependent, whether they are in fact claimed or not, they cannot claim themselves. So that if it's better for the student to claim his own education credits, no one can claim his personal exemption. This hasn't changed, has it?

In this case, there seems to be no choice. Not a matter of who gets how much back, or how inconsiderate the son might be. Just a simple matter of following the law. The son can be claimed, whether or not his parents do so, therefore he cannot claim himself.

[kcjenkins]

But we all know that if the parents choose not to claim him, and he claims himself, the IRS will not have a problem processing both returns that way.

We can tell such kids all day, "You can not claim yourself because your parents supported you and are entitled to claim you as a dependent." But when the parent is sitting right there, saying, "No, let him claim himself", what can we do if they choose to ignore what we tell them about what the law says? Yes, we can refuse to do both returns, but they will still go somewhere and do it that way, and everything will go smoothly, and they will just believe that we don't know what we are talking about. Since the IRS itself does not ever question such filings, why should we lose business over it?

[jainen]

>>the IRS itself does not ever question such filings<<

Well, they do sometimes. Look at TC Summary Opinion 2002-37. First they just said the guy didn't provide half his kid's support. When he argued with them, IRS called him a cuckold.

[Jim Oh Bkkr]

I agree with jainen. I had to fix this mess years ago. Mom did step-child's return (small pension from deceased mother). Mom never told me there was a child in the house.

Child gets a bill for the tax on approx 1,000 (portion of the P/E that she actually used). Mom was paying 28% one the whole 2,600? (yes it was that long ago).

Jim

[Gail in Virginia]

And yet, the American Opportunity Credit has a box to check making the credit non-refundable if the parents provided the student's support but the student claimed him or her self. Why is that even an option?

[Pacun]

But we all know that if the parents choose not to claim him, and he claims himself, the IRS will not have a problem processing both returns that way.

We can tell such kids all day, "You can not claim yourself because your parents supported you and are entitled to claim you as a dependent." But when the parent is sitting right there, saying, "No, let him claim himself", what can we do if they choose to ignore what we tell them about what the law says? Yes, we can refuse to do both returns, but they will still go somewhere and do it that way, and everything will go smoothly, and they will just believe that we don't know what we are talking about. Since the IRS itself does not ever question such filings, why should we lose business over it?

I agree 100% with this.

This is beyond the scope of our services. They will go somewhere else and get exactly the way they wanted simply because it depends on the fact shown to the other preparer. If we, as an industry, do not evolved, people will go from preparer to preparer with different stories and getting it their way. A lot of times I do not give much information to the tax payer because they will use my knowledge to convince the other preparer. Most of the time, I tell them... "I have analyzed your situation and applied the rules. This is what can be done and if you want me to do their taxes, you have to trust me and allow me to prepare your return correctly. If you don't believe what I am saying, you have the right to a second opinion and more opinions."

Let me ask you this: when you present the return for signature, how many times have you heard something like... "I babysat for my sister last year and she paid me $30". What do you do? Take all the papers to the shredder and add those $30 to the return, recreate the e-file, reprint, recreate the e-file and done. You don’t have to answer that.

[TAXBILLY]

I'm troubled by a lack of ethical consideration here. When we sign the return under penalty of perjury are we not affirming that we prepared the return to the best of our ability and not whether the client will go somewhere else to have the return prepared? How could that even be relevant?

taxbilly

[Pacun]

I'm troubled by a lack of ethical consideration here. When we sign the return under penalty of perjury are we not affirming that we prepared the return to the best of our ability and not whether the client will go somewhere else to have the return prepared? How could that even be relevant?

taxbilly

I think you are the perfect candidate to answer my question...

Let me ask you this: when you present the return for signature, how many times have you heard something like... "I babysat for my sister last year and she paid me $30". What do you do? Take all the papers to the shredder and add those $30 to the return, recreate the e-file, reprint, recreate the e-file and done?

How about when you took someone to the airport and he gave you $30 for "gas"? Did you report those $30?

[kcjenkins]

Honestly, Bill, I do not know for certain what I would do in that situation, because I always just do it the right way and tell the clients 'this is the only legal way to do it" and so far they have always accepted my decision and the return. When I wrote that response I was just feeling ticked off that the IRS puts so much responsibility on US to do things right, then seems to often accept returns that are on their face, so clearly questionable that they should never have been paid out without some follow-up first. I'd just been looking over a return brought in by a new referral that seemed fraudulent on it's face! A hair stylist, with over 8000 miles of 'business mileage' and over 3K of 'utilities' although she just rents a chair in someone's beauty shop. Oh, yeah, had 'tools' of over 1K. I have an honest hair stylist that I have done for more years than I can remember, and she has never had over $300 of new 'tools' in one year, even the year she moved into her own shop. 'Tools' being the dryers, curling irons, combs, etc. Yet this woman had been filing similar returns for at least 3 years, and has never even gotten a mail audit of any of these items. And no, she is NOT going to be my client.

[jainen]

>>the IRS puts so much responsibility on US <<

Surely tax preparation is the LEAST regulated financial service. Compare the IRS to the SEC and bank regulators. Of course, THOSE guys need and deserve regulations. Our own ethical standards are self-imposed through the long-standing good works of our industry associations like AICPA and NAEA.

But too many of our colleagues got greedy. Since the Big 5 scandals, the country (that is, our own clients) have demanded stronger protection. Still, it's taken this long and we only have the flimsiest registration system. Read this forum, this thread. The concensus is that we just won't play along with these cheats, even if we lose business. That's honest self-regulation.

[TAXBILLY]

I meant the comment to elicit a continuation of the thread and did not mean it to be a chastisement of anyone. Pacun brings out some good points. I would only say that common sense and ethics are not mutally exclusive, in my opinion.

taxbilly

[kcjenkins]

And I, in my more cynical moments, think that one reason the IRS does not seem to care about the kid claiming himself is that in many [maybe even most] cases the result is that while the kid gets more than he should, the parents lose more, and Uncle Sam is the true winner.

Note that in the example that started this, the parents went from getting $900 to owing $400, a loss of $1300 to them. The son went from getting $244 to getting $1200, a gain to him of $956. Uncle Sam got to keep the difference, or $344 gain to IRS.

Indeed, that may be why I always get my clients to accept doing it right. I do this math, and then suggest that if the parents really want to give him the extra money, they can just give him the $956 out of their refund, and THEY get to keep the extra $344.