call from "investment advisor"

[BP.]

Investment advisor (employee of major brokerage) calls me and says, "We have a mutual client, I saw his tax return, but I want to look at all the schedules, please email complete return to me." He's gotta know that isn't gonna happen, right?

I had a major go-around with this same guy years ago because the selling feature he was using for the solo 401(k) he was setting up for my sole proprietor client (no employees) was the fabulous savings on SE tax- he told them I should be deducting contribs on Schedule C.

[Lion]

Don't get along with most of them

Don't get along with most of them, have a lot of wheeler-dealers in this area. But, you can give your clients an extra copy of their return that they can pass along to their investment advisor if they choose. I have a FileShare on my web site (CCH hosts) where I can upload a .pdf copy that only they can retrieve and do with as they wish.

[BP.]

I have a FileShare on my web site (CCH hosts) where I can upload a .pdf copy that only they can retrieve and do with as they wish.

Thanks, Rita. Sounds "techy" (and me . . . not so much ) but I better check that out post-season.

[Lion]

Safer than email

Safer than email attachments, which aren't legal for tax returns in MA and other places now. Faster than the PO which is 10 miles away. Leaps tall buildings...no, mind went someplace else for a minute!

[taxea]

My standard response:

"I can neither confirm or deny whether Mr...what did you say his name was?...Mr. Smith is or isn't a client.
You will have to provide me with the proper 7216 waiver form signed by your client before I can do anything for you.
Please fax it to my office and when I receive it I will check my files. If I do have what you need I will send you a bill. When that is paid I will send the documents you requested."
I have even had these people ask me to bill the client and I tell them, "You are requesting the information, it is your option to bill the cost to the client."

When I receive the waiver I check the client's signature and call the client to verify that he did sign the form before I go any further.

[BP.]

My standard response:

"I can neither confirm or deny whether Mr...what did you say his name was?...Mr. Smith is or isn't a client.
You will have to provide me with the proper 7216 waiver form signed by your client before I can do anything for you.
Please fax it to my office and when I receive it I will check my files. If I do have what you need I will send you a bill. When that is paid I will send the documents you requested."
I have even had these people ask me to bill the client and I tell them, "You are requesting the information, it is your option to bill the cost to the client."

When I receive the waiver I check the client's signature and call the client to verify that he did sign the form before I go any further.

I like it!

[AZ-Tax]

I was a Securities rep way before I was a tax preparer and..

it wasnt until I became a tax preparer that I realized what a "pain in the you know what" most investments advisors, stock brokers, investment representatives etc. can be. So know I have changed my attittude as a Securities Rep.

[Uncle Sam]

Investment Advisor

For everyone's clarification -
THERE IS NO FORM 7216.
7216 is the CODE SECTION that discusses these ethical considerations.

[Burke]

I like taxea's method. However, I will say I have a very good relationship with all the brokers I deal with, and providing me with information is usually not a problem. You can tell they have gotten more careful about disclosure in recent years, as we have as well. The only thing I usually have to ask them about is cost basis. Although I questioned one about 28% gain item on the 1099, which even he did not know, but located an answer and called me back.

[taxea]

For everyone's clarification -
THERE IS NO FORM 7216.
7216 is the CODE SECTION that discusses these ethical considerations.

Did I say "form" I don't think so. My post refers to the 7216 waiver meaning that the waiver requirements of 7216 must be met. Don't read into things what isn't there and you won't need to point out non-errors

If you like what I said...feel free to use it...just send me a royalty whenever you do...not

[AJsTax]

I like one part

of that response. I agree written permission is necessary to send a copy of a tax return.
But we also believe in customer service and to charge a fee for that to the broker would be a slam to their face. We have to call many investment advisers many times over the course of a tax season to get information on basis and 1099s and we try to maintain a good working relationship. Your approach seems to me to want to push business away.

[equinecpa]

I where both hats - I'm a CPA and a RIA. And I'll tell you what, I might not be an RIA if more of them took the time to look at a client's tax return. I became one because I got annoyed at how many of my clients were receiving investment advice that had really poor tax implications. Like the older gentleman 75'ish with no earned income...RIA was having him make IRA contributions ...mind boggling.

Now if I had an RIA call me for a client's tax information...I would be EXCITED. I'd contact my client and get their written permission in a heartbeat. I enjoy maximizing my client's wealth, I am not just a "tax preparer". I will do whatever it takes to strengthen my clients financial wellbeing. I encourage a relationship between myself and my clients financial advisors - it certainly minimizes those " I wish you would have consulted me first" moments...

OK I'm jumping off my soapbox and will put my CPA hat back on, and get back to those tax returns.

Carolyn

[BP.]

Love all the comments & viewpoints. Enlightening. Wish that any of the ones that call me seemed OK to work with, but see comment in OP about this particular person telling my clients I wasn't getting them all the bang for the buck their solo 401k should have been providing.

Another called me few weeks ago, "Oh we have several mutual clients, they all speak so highly of you, please call me anytime you need basis info for anyone, that's what we do here, blah, blah." Ok, so one of our actual mutual clients does require basis info, so we call. Brick-wall-central. I find basis info for client. They've just been seeming too salesperson-ish and not customer service-y enough.

I'm left with the impression that the several that call me each season just want me to funnel clients their way- piggyback onto the relationships I've built.

You guys who are advisors and also tax preparers prob have a much better perspective.

[FEDUKE404]

Can't email??

Safer than email attachments, which aren't legal for tax returns in MA and other places now. Faster than the PO which is 10 miles away. Leaps tall buildings...no, mind went someplace else for a minute!

I'm curious as to exactly what law is broken by emailing tax returns??

Several of my clients prefer to see draft copies and/or a "final" copy so they can sign the Form 8879 and get it back to me more quickly. Of course, at some point they do get signed, printed hard copies from me via snail mail.

Does this mean that I/we are breaking the law?????

And faxes are very quickly going the way of the rotary phone and 8-track tapes.....

Side question: Is a scanned/signed Form 8879 acceptable, illegal, or what?


FE

[JSLATER]

Protecting Customers' Personal Information: The Safeguards Rule

FTC RULE:

WHO MUST COMPLY?

The definition of “financial institution” includes many businesses that may not normally describe themselves that way. In fact, the Rule applies to all businesses, regardless of size, that are “significantly engaged” in providing financial products or services. This includes, for example, check-cashing businesses, payday lenders, mortgage brokers, nonbank lenders, personal property or real estate appraisers, professional tax preparers, and courier services. The Safeguards Rule also applies to companies like credit reporting agencies and ATM operators that receive information about the customers of other financial institutions. In addition to developing their own safeguards, companies covered by the Rule are responsible for taking steps to ensure that their affiliates and service providers safeguard customer information in their care.
For more information on whether the Safeguards Rule applies to your company, consult section 313.3(k) of the GLB Privacy Rule and the Financial Activities Regulations. Both are available at ww.ftc.gov/privacy/privacyinitiatives/financial_rule_lr.html.

I email returns, but only encrypted. I became aware of the rule through a seminar and read it somewhere, but can't remember where. Brain fried this time of year. Its bad enough to comply and remember all the IRS and state rules, now the FTC gets into the act.