Best practices-verifying client banking information

[jklcpa]

On 10/17/2024 at 1:23 PM, jklcpa said:

I'd suggest that a "best practice" is to definitely review account numbers and routing numbers with the client on any forms they sign, either for withdrawals or direct deposits. I always ask clients to review that data, if the account is still open, and that is still the one they want to use.

 

On 10/17/2024 at 3:39 PM, Abby Normal said:

... get clients to review the bank info and sign that it's correct. We print the Bank Info page of the Efile Info form and add a signature line and a date line. But others use a different page.

I miss the days when this info was right on the 8879.

 

On 10/17/2024 at 4:52 PM, jklcpa said:

ATX doesn't still have this?  I just checked 8879s prepared by Drake, one with direct debit and one with direct deposit, and both show the RTN and Acct number in part II just to the right of the checkbox where taxpayer authorizes   preparer's name .... 

Those were returns prepared early in 2024, and Drake does have another report it prints that I use, so did I miss some change later in this year?

 

On 10/17/2024 at 6:44 PM, Abby Normal said:

ATX had it for years but removed it when the IRS removed it.

 

On 10/17/2024 at 6:44 PM, BrewOne said:

I know this won't help the current situation, but I have a sticky note attached to all 8879's--direct deposit/debit verified?

 

On 10/17/2024 at 7:35 PM, Lynn EA USTCP in Louisiana said:

I print the bank account worksheet, for the client to verify the details are corr3ct. 

 

On 10/18/2024 at 7:10 AM, Jim Oh Bkkr said:

IIRC, this is governed by a "check-box" in the firm/user setup.  I seem to remember it not showing up on an 8879 once, knowing that it did before.  It took me forever to track down why!

 

1 hour ago, Patrick Michael said:

In Drake, an "Account Transaction Summary"  shows the bank name, routing number, account number, and amounts for deposits and withdrawals.  I always highlight the sentence "PLEASE VERIFY BANK INFORMATION" and a warning that if you have provided incorrect information, you are responsible.  There is a spot for signatures.  This has come in handy a couple of times when clients gave me incorrect information and once when a spouse accused me of changing the account information and depositing a refund into the other's account.

All of the above was taken from a topic where the poster had used another client's banking information for a direct withdrawal. I've edited and moved those portions of the comments to this topic for best practice for using and verifying clients' banking information.

[jklcpa]

As Patrick Michael described above I, too, use the "Account Transaction Summary" page created by Drake for all transactions involving the client's bank, and I always review it with the client and obtain the client signature(s) in the area at the bottom of that page. For those states that rely on the federal 8879, including my own resident state, this is the only place that contains all of the entire information in one place including the name of bank, routing and account number, the amounts scheduled direct deposit or withdrawal, and signature lines.  For the withdrawal transactions, this summary page also includes the date withdrawal will occur. 

[Bart]

We have the client initial by the account and routing number and sign the and date the "Account Transaction Summary" page.

[mcbreck]

Those auto withdrawals add stress to my life. The people who really need it are also the people who will never monitor that the payments were made properly or won't make sure the money is in the account when payments are due. I love the idea but honestly they add stress to my life.

 

 

[jiji778]

Getting clients to verify their banking info is a must! Using that "Account Transaction Summary" is super helpful, and having them initial next to their account details adds that extra layer of accountability. It might seem like a hassle at times, but it saves us from potential headaches down the line. Plus, it’s good for clients to be involved and aware of what’s going on with their money!