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Discussion:Now Comes The Part That I Hate

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Discussion Forum Index --> Business Growth Community --> Now Comes The Part That I Hate


Sbcpa (talk|edits) said:

16 April 2008
Every year, it seems, I make at least one or two dumb mistakes. A good client just called and said he got an IRS notice that he had mistated his estimated tax payments. When I investigated, I found that I had double posted his 2006 overpayment, once as an overpayment applied forward (automatic in the software) and once as a first quarter payment. This is a guy who does his own quarterlies, so I just took his list of quarterly payments and merrily posted them in the software. It was not a small amount of money, and I should have noticed that the amount was identical - but I didn't. Now he's mad.

You just work so hard to get it all right, but sometimes in the fog of war, stuff happens. Please tell me others make dumb mistakes. Your silence will indicate your perfection.

Death&Taxes (talk|edits) said:

16 April 2008
That is always my biggest mistake....client lists the total of taxes paid but is smarter than me, and includes the overpayment......you are not alone.

Nancyshoemake (talk|edits) said:

16 April 2008
okay....are we humbling ourselves here? Efile return rejected. Upon further review noticed that the w-2g gambling winnings of $9500 we also showed $9500 of federal withholding. The software 2 years ago had you put w-2g in pensions....and has since switched to another location...We just were thinking "pensions" input...So taxpayer actually paid in $9500 less in federal withholding than was reality. That wasn't a fun call to make yesterday on the 15th!

Sbcpa (talk|edits) said:

16 April 2008
Bless you D&T...

Sbcpa (talk|edits) said:

16 April 2008
Oh Nancy, that's a tough one. Ouch...

WPCPA (talk|edits) said:

16 April 2008
It seems like such a simple matter - what did you pay in - but this always comes up - your short or long on the count - I ask for copies of checks and verify the dates - and verify what they got back from last year, as well.

Joanmcq (talk|edits) said:

16 April 2008
I have one couple that always give me what was paid in the year, so they are counting the January 4th quarter in the wrong year. I watch out for that. Also have a spreadsheet Grant thornton used way back to double check our entry, which I've modified over the years but is still good, especially since I don't have anyone looking over my shoulder and rechecking my work. 3 pages, and the last page is 'taxes paid' with all of the info for the year and it will cross check with what you've entered. I don't have too many clients that pay estimates yet, but its priceless for those that do.

Death&Taxes (talk|edits) said:

16 April 2008
My favorite people send back the instruction sheet I have sent them about Estimated Tax payments with the check numbers on it and the date they paid, usually with the compliment that they like the form I designed. Nothing unclear there.

Newarcher (talk|edits) said:

16 April 2008
You BONEHEAD! :D


I will tell on myself....this was my first official year in business. Now, in my own defense, I have been working with this client for a LONG LONG time this season to get their bookkeeping formatted so I could use it and ensure comliance on their part, etc.--some might call it hand-holding, some might say spoon-feeding. Hey, at least YOUR CLIENTS PAID QUARTERLIES! :D Anyway, I completed their return around 2:30 AM one night last week. I printed out their copy, printed a copy for filing, assembled it with their original source documents, checked and double checked everything, and filed it into the 'deliver' stack.


After delivering it I had a premonition that something was amiss so I went back and looked. Yep, I forgot to include a copy of their 1040 and Schedule A with their State return. Partially in my defense, I looked to see if I needed to and at the time their AGI was less than $40,000. Then they added some income and bumped it just over $40,000. That doesn't excuse me from the Schedule A mistake. So I called here immediately upon noticing it and she had just mailed it 30 minutes previously.


I apologized all over myself and mailed her a signed copy of the 1040 and Schedule A for when the State notifies her where to send the forms (along with a stamp for the envelope). If I was going to make such a mistake, then this was the one to make because it didn't affect any taxes and was painless to the client.


I figure that I am into these people for untold hundreds of dollars in free advise so hopefully they will overlook the slight error. But I am with you, I am a perfectionist and I hate to see anything I do come back wrong.


We may be Accountants, but we are all still somewhat human! :D


Michael

Taocpa (talk|edits) said:

16 April 2008
Sbcpa,

We all make mistakes. As much as I strive to be perfect, I am not and never will be. I think it is ridiculous when our clients hold us to some insane standard of perfection. I have some clients who tell me "how come I have to catch your mistakes." I tell them that sometimes I make them and it happens. I always jokingly tell them I make three errors per tax season and if they are the first to spot one, they win a prize. I then say in my best game show announcer voice, "Grand prize winners receive an all expense paid trip to Washington, DC along with his and hers Samsonite Luggage. Our runners-up receive Turtle Wax for that hard-shell finish and a years supply of Rice-A-Roni, that San Francisco treat." (Yes, I loved game shows as a kid). That softens them up.

I am the absolute hardest on myself when I make mistakes. But I am bound to make more in life and so will all of us. Relax, for tomorrow is another day.

Tom

Nancyshoemake (talk|edits) said:

16 April 2008
Whats burns my butt is when I say I am sorry - next year is on me for free and they start negotiating like I need to do this and this and this and this! Just had a client that had 2 state returns and the state withholding for unemployment was put on the wrong return. We caught it amended it and said we are sorry. That is never enough....no she wants a refund "afterall, I have sent so many people to you and I have been coming to you for so long"...I gently responded that was not my offer.

Fsteincpa (talk|edits) said:

16 April 2008
first of all, the clients are correct. I am perfect and I don't make mistakes. When these test errors are placed into the return and are found by the client, I let them know they have passed the test. They have fulfilled their responsibility portion of our agreement. They have reviewed my work.

Remember, we don't make errors, we just test others to see if they are sharp little tacks.

Newarcher (talk|edits) said:

16 April 2008
I put a clause in my tax engagement letter that specifically states that I do occasionally make mistakes and that even though I am preparing the return, it is their job to review it for accuracy and completeness before filing.


I do, however, see their point. They pay handsomely to get my services and expect it to be right.


Michael

Taocpa (talk|edits) said:

16 April 2008
I believe the client is correct, but sometimes they need to gently persuaded we aren't always at fault.

I am the first one to fall on my sword. I learned that years ago. If I am at fault, I say it. I don't hedge, I don't dodge. My clients know me well enough to know that. Yesterday a new client came here to pick up his return and I looked him squarely in the eye and said, "It's not ready. I made an error and I caught it this morning. It will be ready in a couple of hours." He was happy I told him the truth.

But, is the client correct if they forget to give you something you knew nothing about? Case in point was a client on Sunday called and told me he forgot (after I had completed his return) a boatload of contributions he made. I asked him if he made contributions to charity and he gave me a number one week before and then said he "forgot" he had a bunch of others a week later. He had substantiation for the number he provided later. But why couldn't he follow my instructions to review his return from last year to make sure he had everything? His number is consistent from year to year. His return is almost the same from year to year. I asked him when I saw his number was lower if it was right. His answer? "Yes, that's correct." One week later, it changed.

I do my best when I make a mistake to throw in freebies like everyone else; amended returns, etc. But that doesn't give the client the right to walk all over us.

Tom

CrowJD (talk|edits) said:

16 April 2008
That Form 500 will trick you in another way NewArcher. And it's not in the instructions.

Look at the paragraph above the signature line on Form 500. Note, sometimes it's also necessary to include Scd. 1 (additions and subtractions) to the 500, which your software may not generate. Big picture: GA DOR will call or write if they need anyting, of course, hope that you have indeed taken into account all addtiions and subtractions, if applicable.

JR1 (talk|edits) said:

April 16, 2008
Pick your battles. One client's getting one for free, two others can go screw lightbulbs. The one had asked back in January about the Education credits in a divorce situation and who should claim which dependent...and I'd said it didn't matter since they were over the income limit. Well, they were for the credit, but not the deduction, which we discovered last week. So it did matter. And I blew a $thou on their return.

Two others are ticked because they owe tax and claim that I should have told them, even while in one case, I asked for and didn't get the info to run projections, but it's still my fault. And the other had to pay 97k instead of 87k add'l on a half mil of income. It breaks my heart.

Szptax (talk|edits) said:

16 April 2008
what amends do you make when you identify a mistake after filing. I realized this year I made a similar mistake as that described above. What if you truely make a mistake though (like add an extra -0- to contributions or some such thing?). I think this was discussed prviously, but why not revisit? I think its fair to offer to pay for penalties, if any & the next years prep for free. What do you all do?

Newarcher (talk|edits) said:

16 April 2008
CrowJD,


I had some very simple clients so they didn't have any additions or subtractions. But I will be filing that in the back of my mind to remember! :D


Thanks for the reminder.


Michael

Scottycoyote (talk|edits) said:

16 April 2008
we all make them. I always tell clients "i fix my mistakes for free, i charge to fix yours".

If i make a small mistake and have to fix it, i feel like me fixing it is enough. If its some huge mistake that causes the client grief, and they raise alot of heck i might offer to do their return free next year, but its very rare. If someone is so picky that they feel any mistake entitles them to a free return, then maybe they need to find a new preparer.

Ddoshan (talk|edits) said:

16 April 2008
One I made late this year. Elerly client who broke her hip recently and was more or less confined to her home. I brought her papers over for her to sign and she wrote out the checks for what she owed Federal and State. I had told the client that she owed 1207 dollars to the state, she wrote out check, we stamped and sealed envelope, and I at first told her I would mail for her on my way back to the office but then thought better of it. When I got back to the office and was going thru her return to send via e-file I noticed that the state balance due was 645 dollars.

I had just glanced at the payment voucher and had picked up on the date. The Mn. voucher shows as follows in the bottom right of the voucher .... 1207

Glad I didn't break my own rule about mailing tax correspondence for clients.

Newtaxguy (talk|edits) said:

April 17, 2008
I entered the wrong routing numbers and bank account numbers for direct deposit of a client's refund. It wasn't discovered until the day the clients expected the deposit.

What was bizarre is that the numbers entered were NOT EVEN CLOSE to their checking account information, and were not familiar numbers to either the client or me. Further the bank indicated by the routing number had no account with that account number so I hadn't erroneously entered another client's account info.

So it was a complete mystery to me where the numbers came from or how i made the error.

Unfortuately, there is no mechanism for correcting this. The IRS waits for the direct deposit to "come back" and then issues a paper check, a process that can take up to two months.

Even more unfortunately the clients were hoping to use their refund for a cruise so had to find another way to pay for their vacation.

Joanmcq (talk|edits) said:

17 April 2008
I put the wrong address on one of my former tenants' (their place went to the ex in the divorce)kids very first tax return. Their street number with my street. They live around the corner from me. We had to notify IRS the check went to the wrong address..

Natalie (talk|edits) said:

April 17, 2008
I have one client who says he has held onto a sticky note I wrote about 10 years ago. On it I apologized for some mistake I had made. I've made other mistakes, too, but I think errors are reduced when we take the time to review what we've done after it's "cooled off" for a while. And yes, there is at least one other discussion about paying penalties or giving free services for mistakes made.

CrowJD (talk|edits) said:

17 April 2008
Well, I pulled a big Boo Boo. Took a clients return to Starbucks for a break and a quick review. She's a local newscaster. She had quite a lot of medical work done to her of a cosmetic nature after she was involved in an auto accident [slight fender bender, go figure].

Well, I walked off and left the return on the table. 6 hours later I realize it, and it was never turned into lost and found. (As an aside, they did have an old umbrella of mine from two weeks ago.)

Well, after I had gone and bragged about my privacy procedures to client(maybe exaggerated since I really have none other than a file cabinet I can't find the key to], here all this happens. All her plastic surgery, which involved rejuvenation and resurfacing of just about everything, including private parts, and of course, I just had to itemize it ALL! So, is this pack it in time? I can pray a nun or blind person picked it up by mistake? What a fix! And the worst thing about it all was that the coffee really wasn't that good.

Well, I'm flying out tommorrow anyway for a religous conference in Vegas at the old Mustang ranch property.  Wayne Newton has agreed to "Rock of Ages" and "Memories".  If I don't see you again...

Natalie (talk|edits) said:

April 17, 2008
Have you told the client yet, Crow? Was it obvious that it was a return? Maybe the cleaners came, and it got thrown away.

Smokeytax (talk|edits) said:

17 April 2008
Wow, that's a tough one.

I don't know what good it would do to notify the client.

You stand behind your work & will make amends if and when any harm comes to the client, but maybe that's a bridge to be crossed when you come to it.

Otherwise, perhaps notifying the client would just cause unnecessary worry to her.

PhoenixTax (talk|edits) said:

17 April 2008
Whoa, that takes the cake!

Crow, with all due respect, you may not have helped your cause by re-living that event in this public forum. Maybe i'm just overly-cautious about what i say to whom, but you are talking about a local newscaster.

I hope for all hopes that when you return home from your enlightening 'religious' conferencing at the ranch you find that some do-gooder has placed the original(?) return in your mailbox, or returned it to your office.

Death&Taxes (talk|edits) said:

17 April 2008
Crow: that will teach you to break for coffee at Mickey D's where the return would have been swept into a hugh trash bag with half-full supersized cups of badly mixed root beer, greasy wrappers, unfinished fries and the like.

CrowJD (talk|edits) said:

17 April 2008
Well I can't be responsible for everything. I was hired to do the tax return, I and did get it done. I just don't know where it is. As I say, what really get's me is that the coffee was just awful. Had it been good coffee, it would have almost been worth it! I'll let you know what happens.

You may say, "Well, why don't you at least run off a new copy of the return before you leave town, and get it in the mail? The truth is, I can't. I have a trial version of my software, and I can only keep three active returns on the thing, so, it's gone. I only paper file.

Natalie, it really wasn't obvious that it was a return, remember, I prepared it, and it was somewhat stained, had crumbs on it. All my returns are a bit non-standard, as I have a habit of doodling on them. It could pass for an immigration application in the right light I suppose, or even a worked over settlement statement.

Death&Taxes (talk|edits) said:

17 April 2008
Not quite in the same category, but I found out late in season, after a number of 'I didn't get my return' emails and calls, that I'd printed the address labels for envelopes using a two year old database....including one $12 postage return that when I used that data base for real two years ago, the address in it was already out of date....that time we didn't get the original back until late April; this time it came back on April 9th so I put it in a Fedex pak and shipped it out.

CrowJD (talk|edits) said:

17 April 2008
First thing I get up every morning, I check the postal rates. Some people follow the Dow. Can't do it. Not with the rates changing as they do.

CrowJD (talk|edits) said:

17 April 2008
NEWS FLASH: Thank GOD for the Pope! It turns out there was a nun and a blind person at Starbucks, taking refreshment on the way to see the Pope. Normally, I would have noticed this, but nun's don't wear habits these days, and blind people seem to see better than they used to,what with all the benefits attached to it. AND THEY DID pick up the return. This is like winning the lottery, folks. Neither of them watch the news, well, except for EWTN, and I guess the blind person just listens to it.

I am writing this on the plane to Vegas, and I've sent my mother over on her Scooter to retrieve the missing return.

Jdugancpa (talk|edits) said:

17 April 2008
As my (at the time) six year old niece said after each whopper she told us: "Believe???"

Natalie (talk|edits) said:

April 17, 2008
Smokey, it is our responsibility to tell our clients when their personal information has been compromised. In fact, I think it may even be a law.

MEMCPA (talk|edits) said:

17 April 2008
New client who is working overseas has friend email W-2's etc. Friend, being the careful sort, redacts the SSN from all the documents. Why I thought that EIN with only one hyphen was a SSN, I'll never know.

Taocpa (talk|edits) said:

17 April 2008
I think Crow is wise to share his tale of woe as a warning for the rest of us. I don't recall ever doing that, but it's a good reminder to be very careful if you do.

Now in re-reading what he wrote, I am wondering if Crow's misadventures aren't becoming as legendary as Fred's.

By the way, I saw the Pope today. I'll stick it in another thread. And it will have a kernel of truth in it.

Tom

Smokeytax (talk|edits) said:

18 April 2008
Yes, you're right, Natalie. Thanks for the reminder.

The whole area of data security and client disclosure requirements is something I'm just getting up to speed on.

Natalie (talk|edits) said:

April 18, 2008
It seems like every week there's some company that has had data stolen. A recent one I read about was credit card information that was stolen while in transmission to the credit card company. Now that is scary.

Kokomo (talk|edits) said:

18 April 2008
I was getting frustrated that my employees were making many mistakes - one made a difference of $6000 in the tax liability - until I found out that I make quite a few too. The worst however, was when my admin mixed up 2 tax returns. She mailed Client A's return to Client B and vice versa. We did send it through UPS so the tracking helped somewhat but UPS fell way short of my expectations and could not stop the shipment. I had to call client A and ask them to not open the package and return it to me. Client B did the same. Needless to say, both clients were very mad. I apologized profusely. I had a paid consultation session (for $250) w/ Client A scheduled for a week after that and told them it's free and that helped ease things a bit.

TaxNerd (talk|edits) said:

18 April 2008
Finally a thread that I consider myself an expert in - screwing up. My best so far: While inputting a stock trade for a client, I entered the sales and the basis, but for some reason I also entered about $13,000 under "federal withholding". So I get the unenviable task of telling him that his letter from IRS is correct, and that he does indeed owe 13K plus to IRS.

And this just in: The other day I completely forgot to file extensions for all my partnerships that haven't been prepared yet. Luckily only three of them left, and they only have two parters each, so I'm only on the hook for $100 each if I can get them done by May 15. (Did I mention I have increased my fee $100 for partnerships this year?)

Death&Taxes (talk|edits) said:

18 April 2008
That Federal tax withhelg glitch gets me once a year, or the one back when tax free mutuals used to pay dividends instead of interest, I would enter the income on the tax withheld line.

As a famous chess master once said, 'the mistakes are out there, just waiting to be made.'

Tpasco (talk|edits) said:

27 April 2013
I have made a few big ones. In 2011 I was running a low-income tax clinic for the college where I was teaching part time. That was a mistake. I forced a state deduction for 529 payments onto the tax credit line. Not a fun telephone call. While the clients were pretty nice about it, I am kinda amazed they came back the next year. That year I also miscalculated an ext payment because the financial advisor guy omitted all the long-term gains from the capital g/l report that he sent over. I think this was not strictly my fault, but I should have questioned it and wanted to keep this client so I paid the underpayment penalty on that amount. It hurt, it was almost $1,500, and to add insult to this injury the damn financial advisor charges my client over 50K a year but can't even get the CG/L report right. Gah.

And in 2010, in part due to switching software when I opened my own office in 2009, I incorrectly reported two clients' taxable IRA distributions as nontaxable. I had been using ProSystemfx which filled this as taxable as a default, and UltraTax does not. That sucked. Both of those weren't noticed by the IRS until last year, so the penalty and interest was a painful payment made by me.

These last clients were not understanding, and did not come back this year but honestly I wasn't sorry to see the back of them. I started my practice with about 100 clients brought over from my old firm. The tax partner there died right after I started, and she was MUCH beloved by her clients, who mostly disliked and mistrusted me from 2006 on when my boss died and they got me. I think they only followed me because there's a huge amount of inertia with respect to the tax return preparer, people just don't change this if they can avoid it. Even if they want to, it takes planning and energy that doesn't get done until it's tax time and then they just shrug and come back. I was glad to have the business, but since my old firm really under-charged, I have been raising prices and the old clients who never liked me much have been dropping away. And being replaced by new clients who seem to like my services much better.

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