NT / There's always THAT ONE GUY

[Guest Taxed]

Do you guys charge an additional fee to respond to CP2000?

[michaelmars]

depends on the situation, and how long it will take to respond.

[Jack from Ohio]

It depends if it is an omission or mistake on my part or not. My bad = no charge. Their omission or an IRS "looney" situation, then I charge.

[JohnH]

Like Michael, I base that decision partly on how long it takes. For any error I may have made, there's no charge regardless of how long it may take. For something not of my doing but which takes very little time (maybe a letter or phone call), usually no charge because it's a part of good client service. I don't nickel and dime my clients.

But for something involved and which I should have been told about (1099-B, etc), I charge for the time spent getting it sorted out. For non-clients who need help with something like this, it's full charge for every minute spent (unless there's an extenuating circumstance).

[Lion EA]

For my cause, no charge. For continuing clients, I have enough built in to their fees that I feel comfortable taking those phone calls, answering those questions, responding to the IRS up to a point and without extensive calculations. If it's going to go over the time in which I feel comfortable, then I charge, but at a bit of a lower rate than I use for new clients, separate engagements like an audit, etc. I often offer to put it on next year's bill as much is done over the phone. I don't want then to feel nickel and dimed. But, for a large chunk of time or expertise, I bill at that time. (Sometimes, I have clients write out a check contributing to Appalachia Service Project if it's during that April through July period when I'm spreading the word.)

[jklcpa]

I do the same as Jack, John and Lion.

[Guest Taxed]

I am in agreement with you guys about the CP2000. I have not charged any of my existing clients any additional fee even if they screwed up by not giving me a tax document (most of the times it is a 1099-Div or R). However if I have to do a new schedule because of their mistake I will charge like $20 just so that they don't form a bad habit.

If they come 2 days before the response is due then I will charge little more for rush job. Client pays for all mailing costs.

I agree I don't want them to think I am nickle and dimeing them, but at the same time I really can't afford to waste my time if they form a bad habit.

[MsTabbyKats]

I charge unless it's my fault. Maybe $25..... But, in NYS you have to send in every single page again....and the NY-X is 5 pages....so those amended NY returns can look like a book.

This is especially true when people MUST file by Jan 15 to get that refund......and a 1099-Int comes in a few weeks later. Otherwise, they get in "the habit".

[Guest Taxed]

>>> and the NY-X is 5 pages....so those amended NY returns can look like a book.

Why is it 5 pages?

The MA form CA-6 is 2 pages but you really end up using one page. If you are doing a 1040X as well they want a copy of the 1040X.

If you are doing state only just the CA-6 and the changed form.

[mcb39]

It really depends on facts and circumstances. If this is a client in good standing, I generally don't charge unless then ask if they owe me something. Then it is a very minimal amount. My take on this business is that it is not "all about money"! Now, I don't need ten people jumping on this post to tell me how stupid I am. I already know what many of you think.

[MsTabbyKats]

>>> and the NY-X is 5 pages....so those amended NY returns can look like a book.

Why is it 5 pages?

The MA form CA-6 is 2 pages but you really end up using one page. If you are doing a 1040X as well they want a copy of the 1040X.

If you are doing state only just the CA-6 and the changed form.

I guess they like paper....the 201-X is five pages. And then you have to add everything that was on the original return (not just the changed forms).

[Guest Taxed]

I only have a handful of NY clients (or those who also file in NY) and If I ever have to do a NY 201-X, I am charging additional fee. Thanks for pointing out the requirement.

[Mr. Pencil]

Do you guys charge an additional fee to respond to CP2000?

Naw, it's usually my own fault anyway. I take a broad view of my fault. Missing a 1099? I should have caught it in the interview. That's if they are audited--if they catch it in time, I charge for amending the return. It sounds inconsistent, but it generates the most revenue with the least hassle. Clients get so weird about an IRS letter, I just want them out of my office no matter what I have to do..

[Guest Taxed]

>> Naw, it's usually my own fault anyway.

I am having a little difficulty believing that?? Someone else I can see.

[michaelmars]

>> Naw, it's usually my own fault anyway.

I am having a little difficulty believing that?? Someone else I can see.

I sort of agree, is there was a 1099 last year, not given to me this year, then its my duty to question it. That's the point of continuity with a client and your advantage then them going to turbo.

[jklcpa]

Michael's got it. It should be part of SOP to check for missing 1099s by looking at last year's return and asking questions and documenting answers. My guess is that we've all had clients tell us an account was closed and later find out that it did have some activity that affects the tax year we are preparing a return for.

A couple of years back one of my clients thought he didn't have to give me his tax-exempt interest income, also t/e for the state, because after all, it's tax exempt right? He never had t/e investments in the past and this was a new investment for him that generated over $30K in t/e interest. I found out about it in the course of discussing the sale of real estate he had earlier in that year and because I didn't see any bump in other investments or increased investment income.

[JohnH]

Naw, it's usually my own fault anyway. I take a broad view of my fault. Missing a 1099? I should have caught it in the interview. That's if they are audited--if they catch it in time, I charge for amending the return. It sounds inconsistent, but it generates the most revenue with the least hassle. Clients get so weird about an IRS letter, I just want them out of my office no matter what I have to do..

I especially agree with the last part of your last sentence. From the outset and at every stage in between, I do everything possible to keep my clients out of my office so I can get some work done.

[Guest Taxed]

Do you guys use the standard NATP checklist with your clients, especially the forgetful ones?

When I first started I was accused by a client of forgetting to put bond interest income that she received but did not give me any documentation. Since then with clients that receive substantial div or int income and getting up in their age, I run that checklist and have them sign it.