Catherine Posted April 15, 2011 Report Share Posted April 15, 2011 Client of several years. Had termite & carpenter ant damage found in 2010; needed extensive repairs structural to house, trees that served as feeders fro nests had to be removed, etc. He wants to deduct as casualty loss. Tried to explain insect damage not "sudden" and therefore not deductible. Well, he doesn't agree with me, because it sure was sudden and unexpected to him, and insists that I include the damage in his return. I've sent him a scan from TTB stating not deductible. If he still insists, I'll have to offer him back his paperwork, as I'm not going to submit a loss that I know will be disallowed. And possibly get me a preparer penalty for a frivolous position. Sigh. Quote Link to comment Share on other sites More sharing options...
JohnH Posted April 15, 2011 Report Share Posted April 15, 2011 Sometimes you just have to put your foot down. Funny how people can rationalize how the rules don't apply to them, especially when it's their ox that's being gored. Quote Link to comment Share on other sites More sharing options...
Margaret CPA in OH Posted April 15, 2011 Report Share Posted April 15, 2011 Yes, aren't we/they all special. Kinda makes me crazy when clients don't want to accept certain results even when I point out all the positive things that benefit them. Never enough. Quote Link to comment Share on other sites More sharing options...
Catherine Posted April 15, 2011 Author Report Share Posted April 15, 2011 Thanks for listening (reading) & sympathy! At one point yesterday things were bad enough that I literally crawled and then sat under my desk and told Gwen, "Tell anyone who calls that I'm gone and won't be back until May!" :wall: Quote Link to comment Share on other sites More sharing options...
Lynn EA USTCP in Louisiana Posted April 15, 2011 Report Share Posted April 15, 2011 Yep, I had an old client who's going to be 'let go' too. He wanted me to amend his return for an unsupported position. I ignored his phone call for a day so that I could get myself calmed down. Today when he called I told him that his position lacked substantial authority, that the info he received when calling the IRS did not constitute substantial authority, and I was not willing to submit myself to possible sanctions, disbarment and a $5000 fine. While I know he doesn't agree with me he did appreciate my candor. Hope he goes elsewhere next year. I may just send him the 'you're fired letter' anyway. Lynn Quote Link to comment Share on other sites More sharing options...
Kea Posted April 15, 2011 Report Share Posted April 15, 2011 I really love it when clients try to argue tax law with me. I'm not saying I know everything. When I don't know, I tell them so & that I'll research it. When I figure it out I let them know. Some don't think the correct answer is "logical" (and sometimes I agree with them), or it's just too much work. But, I've lost a couple of clients because I won't file a fraudulent return. No problem, those aren't the ones I want to keep. Quote Link to comment Share on other sites More sharing options...
Margaret CPA in OH Posted April 15, 2011 Report Share Posted April 15, 2011 I agree, Kea. I had what I thought would be very good clients a couple of years ago until they were unhappy with my refusal to take certain deductions. Then they disputed the bill and refused to pay. In a letter I was told that it was too intimidating in my office because I had a newspaper headline about a tax preparer being sentenced for fraudulent returns. Not really sure they actually got the connection but I am glad they didn't return. Of course I wouldn't have them return without them paying the previous year. Only time I was ever stiffed. Quote Link to comment Share on other sites More sharing options...
Achmid Posted April 15, 2011 Report Share Posted April 15, 2011 Criteria:1>Plausuble possible story, not necessarily probable 2> Is his check good and adequate compensation 3) what is the potential for a problem. Quote Link to comment Share on other sites More sharing options...
michaelmars Posted April 16, 2011 Report Share Posted April 16, 2011 Yep, I had an old client who's going to be 'let go' too. He wanted me to amend his return for an unsupported position. I ignored his phone call for a day so that I could get myself calmed down. Today when he called I told him that his position lacked substantial authority, that the info he received when calling the IRS did not constitute substantial authority, and I was not willing to submit myself to possible sanctions, disbarment and a $5000 fine. While I know he doesn't agree with me he did appreciate my candor. Hope he goes elsewhere next year. I may just send him the 'you're fired letter' anyway. Lynn why do you want him to go elsewhere? he stated an opinion and so did you. perhaps he listened to you and respected your opinion? wait to see what he did before you fire him, i have heated debates all the time. Quote Link to comment Share on other sites More sharing options...
jainen Posted April 16, 2011 Report Share Posted April 16, 2011 >>info he received when calling the IRS did not constitute substantial authority<< While such a citation is not enough to support a position in tax court, it probably IS "substantial authority" for purposes of assessing penalties. Quote Link to comment Share on other sites More sharing options...
Lynn EA USTCP in Louisiana Posted April 16, 2011 Report Share Posted April 16, 2011 >>info he received when calling the IRS did not constitute substantial authority<< While such a citation is not enough to support a position in tax court, it probably IS "substantial authority" for purposes of assessing penalties. To Michael Mars - Actually, I placed the 'we can no longer serve as your accountant letter' in the clients' folder. But his parting comment was "I wish you had told me this a week ago; today's the deadline." (meaning 4/15). At that point I advised him the deadline this year was 4/18 not 4/15; I took his comment re wishing he'd known before 4/15 to mean that he'd have sought assistance elsewhere to amend the return. He repeatedly commented that 'his brother's accountant let him take the .....' so I presume he may have called the brother's accountant. If so, then good luck to them. Lynn Quote Link to comment Share on other sites More sharing options...
TAXBILLY Posted April 16, 2011 Report Share Posted April 16, 2011 Client: I worked this out on Turbotax and I bet you I came up with the same answer as you (just before looking at the return I prepared). ME: Then why do you pay me to do your return? Client: Because I trust you and you have been doing my return for 20 years but for $10 I can do it myself. Me: You'll have your wish next year. Client: Why, are you retiring? Me to Ex Client: No! Quote Link to comment Share on other sites More sharing options...
kcjenkins Posted April 16, 2011 Report Share Posted April 16, 2011 >>info he received when calling the IRS did not constitute substantial authority<< While such a citation is not enough to support a position in tax court, it probably IS "substantial authority" for purposes of assessing penalties. I disagree. While it might be enough 'for him' to avoid a penalty, it would not be enough for a tax professional, unless that tax pro had asked the question himself. Because we all know the main reason so many people get wrong answers from the IRS is that they do not know how to ask the right question in the first place. If you know the answer is wrong, then "relying on it because the client said that the IRS said...." is just not good enough. I'd be ashamed to even offer such a defense, personally. Quote Link to comment Share on other sites More sharing options...
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