Help! I don't want to do this tax return, but the parents are my clients

[NECPA in NEBRASKA]

Thanks. I will just change the question. If I don't charge for a return, and just put in the numbers and print it to be mailed, can I keep my PTIN and name off of the return? Since both will be EITC returns and I don't have access to the taxpayer to ask the required questions. My biggest hangup is the EITC portion. There would be no refunds without it.

Thanks.

Edited October 28, 2014 by NECPA in NEBRASKA

[MsTabbyKats]

You can tell the parents that you don't have the software for those years (new computer etc).  Otherwise, just do without being judgmental.  Lots of people do things...this guy got caught.

[JohnH]

I've had situations over the years where parents who were good clients  asked me to prepare a return for a child when I absolutely didn't want to get involved.  No interest in preparing the child's return but didn't want to lose the parents' business.   In a few cases, I managed to convince them that the child was better off going to HRB. JH, Liberty, etc (especially if EITC was involved since I just don't do those returns). 

 

But in the cases in which I did relent, I just prepared the return at no charge. Then I'd tell them that's all I can do and the child has a year to find someone else for the next return.  Most of the time people understand, and they don't like getting charity (especially if they don't need it).

[RitaB]

It's always great when solid citizens get EIC.  I wouldn't want to help the guy, either. 

 

The parents, yeah.  I guess you have to decide if you can stand it in order to take a weight off the parents.  Tough call.

[NECPA in NEBRASKA]

Thanks. I will look into preparing at no charge.

[MsTabbyKats]

Thanks. I will look into preparing at no charge.

Why no charge?

 

They may expect a freebie every year.

 

If anything, I'd charge extra....the "prior year" fee!

[Jack from Ohio]

Charge your normal fee.  Do your normal due diligence.  Treat them like every other client.  If appropriate, just say no.  You can be accountable if there is incorrect or inaccurate information on the return. 

 

Stop feeling sorry for those that do not deserve it.

 

Just say no.

[RitaB]

Thanks. I will just change the question.

 

I thought the original question was fine.  Just sayin.

[kcjenkins]

If I don't charge for a return, and just put in the numbers and print it to be mailed, can I keep my PTIN and name off of the return? 

Yes, although it's not ideal, if you don't charge for it and just print it without any preparer info, you can.  

[JohnH]

Why no charge?

 

They may expect a freebie every year.

 

If anything, I'd charge extra....the "prior year" fee!

I explained the rationale for "no fee", and why they won't/can't/shouldn't expect the same next year.

It's a graceful way to exit from an awkward situation.

My business philosophy is based on the idea that the ability to make distinctions is essential.

[SaraEA]

Don't do it!  Or do what Jack wisely says and treat them like any other client--ask the due diligence questions and charge your normal fee.

 

The problem with not signing as a paid preparer is all the fraudulent preparers who do that and get caught.  We've all reviewed many EITC returns from prior years that say "self-prepared."  Yea, right.  The IRS notices too.  Of course if you do this as a freebie you can't sign as a paid preparer.  But the bad preparers didn't sign and did get paid so you'll get lumped right in there with the rest of them.  Do you really want a call or letter or visit from the Office of Professional Responsibility?

 

Explain to the parents that you'd really like to help their children out but the IRS has strict controls over EITC returns and the responsibility is so great that you can't do it without interviewing the children and charging a reasonable fee for the risk.  I too would refer them to Block or JH--just tell the parents these chains are experts in EITC, which they are, and can do a much better job than you because they are so well versed in the EITC rules.

 

In our office we do very few EITC returns, all for clients we've known for a long time who own businesses that had a very bad year, just got divorced, whatever reason for their income to plummet.  We don't take many new clients, and those we do who turn out to be EITC-eligible get referred right out the door.  Hard to do sometimes when they were sent by a good client, but it's just not worth the risk.

[kcjenkins]

One single return, even if signed, will not get you "lumped right in there with the rest of" the bad preparers.  But the call has to be yours, because you have to be at peace inside.  I do like Sara's option: "Explain to the parents that you'd really like to help their children out but the IRS has strict controls over EITC returns and the responsibility is so great that you can't do it without interviewing the children and charging a reasonable fee for the risk."  While I'd never say Block or JH can do a much better job than me, I have told some potential clients that these chains are experts in EITC returns, and are less expensive than me.  

[SaraEA]

kc, you're right not to downgrade yourself by saying the chains can do a better job, but unless your pricing is through the roof there is no way they are less expensive.  They charge for HOH filing status, child tax credit, additional CTC, and of course the EITC and due diligence forms.  A one W-2 return with these items can end up costing over $300. Just hope the client doesn't have a retirement saver's credit too.

[MsTabbyKats]

OP-

 

As a tax preparer you are supposed to be objective.  Ask his parents the questions if you can't speak to the client.

 

I bet if you had access to the life story of every client....there would be some that did far worse than this man.

 

Nobody likes what he did...but if he's entitled to an EITC, then he's entitled to an EITC.  It's the govts decision...not yours.

 

I wouldn't do this one and omit my information...because if he gets questioned, for sure he will say that you prepared the return.  And that's gonna look a whole lot worse for you than if he gets questioned and your name isn't on it.

 

If he's single the chances of him being questioned approaches zero.  If he's HOH...which a couple of kids and a Schedule C...high risk.

 

Your job is to prepare taxes....not to judge people.

[RitaB]

 

 

Your job is to prepare taxes....not to judge people.

 

I'm going to respectfully disagree with this statement.  Unless NECPA is an employee under the direction of a someone telling her how to do her job, I think she can decline any engagement for any reason.  As a business owner, I have decided not to prepare the returns of people just because I had a "feeling" they were hiding income.  I judged them.  Now, it would be different if I refused to treat somebody who was bleeding to death.  The persons simply went elsewhere.  I am not making this post with a mean spirit, and hope it is not taken that way, but people running businesses still have some freedom here.  I think.

[jklcpa]

NECPA, is it possible that the son had income from his illegal activities? It's still taxable even if from illegal operations and could potentially knock him out for EIC depending on the level of his other income in '11 & '12.  That may get you off the hook for the EIC, but the due diligence would include asking the parents if there is any other income, legal or illegal, that should be reported.

 

If you do prepare the return, I think you should treat it like any other professional engagement, due diligence included, and sign you name.  Otherwise, send them to one of the big box chains that handle EIC returns all the time.

[NECPA in NEBRASKA]

I don't have to be objective in my selection of clients. I am not an attorney and I own my business so I choose my clients as carefully as possible. I certainly wouldn't let him into my home and that is where I work.

 

Judy, I would not be surprised if he had income from his illegal activities and that is certainly one of the reasons that I don't want to mess with EIC. Fortunately, I am swamped with a ton of work and education to take so advising to them to go to a big box will get the returns done much quicker.  

[RitaB]

NECPA, is it possible that the son had income from his illegal activities?

 

 

 

 

Judy, I would not be surprised if he had income from his illegal activities and that is certainly one of the reasons that I don't want to mess with EIC.

 

I would say the odds are about 100%.  Bet he didn't issue 1099-Misc forms to subs and cheats at cards, too. 

[kcjenkins]

I'm going to respectfully disagree with this statement.  Unless NECPA is an employee under the direction of a someone telling her how to do her job, I think she can decline any engagement for any reason.  As a business owner, I have decided not to prepare the returns of people just because I had a "feeling" they were hiding income.  I judged them.  Now, it would be different if I refused to treat somebody who was bleeding to death.  The persons simply went elsewhere.  I am not making this post with a mean spirit, and hope it is not taken that way, but people running businesses still have some freedom here.  I think.

Unless it involves refusing to take on a client in the LGBT community......then you need to be VERY careful how you word your reason, because clearly some of them are just looking for someone to sue.  

[NECPA in NEBRASKA]

My reason for turning people down is always the real reason; I can't handle any more work. I barely sleep as it is and it's not fun anymore.

[Margaret CPA in OH]

Wouldn't it be unethical to ask the parents about son's income?  It appears as though this potential client is an adult.  I would never ask the parent of an adult client about the adult child's financial matters without that parent having durable power of attorney.

 

For the record, I would decline to accept this client.  I can be objective and perform due diligence but I do not do EIC returns without a prior longstanding client relationship and that happened exactly once in 15 years.

 

My business is in my home though mostly electronic and I only take referrals and do not accept all of those.  I do not typically document my reasons. 

[NECPA in NEBRASKA]

Thank you. I know that they have a general power of attorney, but maybe I would need a consent form now with the new rules. Maybe they can just wait until VITA opens up again and they will continue preparing it with no questions asked.

[joanmcq]

Unless it involves refusing to take on a client in the LGBT community......then you need to be VERY careful how you word your reason, because clearly some of them are just looking for someone to sue.  

No, then you send them to me.  I do work remotely and will prepare returns regardless of the state they are in.  I'm up to date in all the state's laws regarding same-sex couples. 

[JohnH]

Joan:

Glad you posted that. 

The law in NC just changed and I'm not interested in expanding since I'm transitioning into retirement.  

I'm not taking on new clients, so if I get any SSM inquiries I'll give them your contact info.. 

[Lion EA]

I don't know what the original question said.  But, your revised question talks about EIC and not being able to interview the clients. You HAVE to do the due diligence.

 

But, I too am swamped with prior year and other late returns, so would refuse any business, even referrals from current clients.