Trial Balance & AJE from prior accountant?

[tacks]

I have a client that has a good relationship with his former accountant. This client went to me for a few reasons. And his prior accountant holds no grudge -- an amicable split, so to speak.

In the past i was at the other end of such an arrangement. And I volunteered any and all workpapers which the new accountant wanted. The new accountant called me and requested my Trial Balance, AJEs and deprec sched. I was more than happy. (This was ten years ago and the client had major major probs of which i was not aware. I suggested they go elsewhere to someone with relevant experience.)

What about me, today, requesting the AJEs and TB from my new client's proir accontant? Is that professional? Is it often done?

(Not sure that i even need them. I'm just trying to make my life easy. I'd certainly be interested in seeing them.)

EDIT: Then again i don't want to appear as though i'm incapable of prepping an 1120 on my own.

[taxea]

First you need a signed 7216 (rule) waiver. Personally I don't provide what I consider work product, which would include the depreciate schedule. I don't charge the client for worksheets so I don't provide them. If the new acct is any good he can reproduce the information from what the client provides. You are just saving him work and he will probably charge the client for setting up the depreciation anyway.

[newbie]

Just my opinion but

To not forward Depreciation schedules just seems wrong, these can be a real pain to reconstruct whether your a good accountant or just a wanna be like myself.

I would have a hard time believing the price of the depreciation schedule was not incorporated into your fee, so if you were stiffed the fee it's one thing, but "just because" is just not right.

[S T]

Agree with Newbie

Regardless - I provide all tax clients a copy of the depreciation schedules - it really is just wrong that they are not in at least the Clients copy of returns and/or work papers. They are a part of the tax return and not just my "work papers" There are too many variables on elections to "depreciate assets" i.e. section 179, special allowance, then look how many times the wrong depreciation has been taken, for whatever reason.

Of course, on the other side (clients) it is up to them to find those schedules and produce them to the new preparer or accountant - and I find that Client's often times are "Lazy" in trying to find much needed records of any kind.

I would think that if you had a "Client" sign an authorization to allow you to request prior year information from the former accountant/tax preparer that would suffice. And you would not being showing any kind of "ineptness" , but rather I think a positive note of "due diligence" to be in the best interests of your client.

Sandy

[thomtax]

Agree with ST & newbie

Client has paid for depr. schedule, in one way or another, and is entitled to this info. However, I believe that it is the client's duty to get it from the old preparer. And I would disagree with the comment that a good accountant could make up a new one from scratch. When someone has items purchased over a 20 year period, and with all the various bonus depreciation, sec. 179, etc., and probably no client records back this far, it would be nearly impossible - IMHO.

LT

[BHoffman]

I prepare lots of business returns and always ask for stuff like depreciation schedules, financial statements if prepared, shareholder basis worksheets, etc. This would not be a reflection on your abilities at all. In fact, I think it would appear to be responsible and professional.

[abctax]

"You are just saving him work and he will probably charge the client for setting up the depreciation anyway." Now that seems a bit cynical....:-)

I agree with the others, I provide the depreciation schedules (they are actually included with my client copy of returns). I have even occasionally provided/or received the actual Lacerte file when clients have changed from me/or to me. Depends on the relationship and the reason for the switch.

[Jesse]

There are too many variables on elections to "depreciate assets" i.e. section 179, special allowance, then look how many times the wrong depreciation has been taken, for whatever reason.
Sandy

When someone has items purchased over a 20 year period, and with all the various bonus depreciation, sec. 179, etc., and probably no client records back this far, it would be nearly impossible - IMHO.

LT

I am in agreement with providing/obtaining the depreciation schedules, even if billable time, it can be a time consuming headache I would rather avoid.

[Gretel]

First you need a signed 7216 (rule) waiver. Personally I don't provide what I consider work product, which would include the depreciate schedule.

Boy, am I glad to live far away from Hawai and will never have to prepare a tax return for a former client from you. I respect your personal choice but do believe the depreciation schedule is part of the copy for the client.

[tacks]

Thanks

Thanks to everyone who responded!

But as i looked a little deeper in to the books and records i concluded that i really don't need anything from the prior acct. It's all there right in front of me.

It's no longer an issue.

[AJsTax]

I was just involved

with this exact discussion on another board, and those posters were split on this idea also.
It seems to run more in the area of where you live and work or maybe who has done the work in the past.
In my 15+ years experience involving thousands of tax returns I have NEVER!!! seen the depreciation schedules included in the client copy. Are they required to be sent with the tax return? NO! that makes them work papers. PERIOD!!
On the other hand I have not had much trouble asking for and receiving the schedules from prior preparers and I will always give them to a former client with a smile. No problem.
Now show me where it says I have to include them with the tax return and I will change my practice in a heartbeat. Until then they stay in my file.

[taxmom34]

i totally agree that the depreciation schedule is part of the return and client is charged either by the number of entries or time involved. I have been phasing down my clients over the past few years and i made sure that clients who had depreciation had a copy of that schedule and informed them when going to a new preparer to bring their copies of return to that preparer and if any help was needed to figure out what i did i"d be glad to explain. i've had clients who went to a lawyer one year because they thought was too complex for me, and came back to me and i had to ask for depreciation schedule and they provided with no problem.

[Jesse]

with this exact discussion on another board, and those posters were split on this idea also.
It seems to run more in the area of where you live and work or maybe who has done the work in the past.
In my 15+ involving thousands of tax returns I have NEVER!!! seen the depreciation schedules included in the client copy. Are they required to be sent with the tax return? NO! that makes them work papers. PERIOD!!
On the other hand I have not had much trouble asking for and receiving the schedules from prior preparers and I will always give them to a former client with a smile. No problem.
Now show me where it says I have to include them with the tax return and I will change my practice in a heartbeat. Until then they stay in my file.

I'll agree it is not required, but if asked for by the client or preparer with written permission from the client why wouldn't you hand it over?

I did not include the depreciation schedule in my clients information until 2008. We had an EA in his early 50's pass away from a stroke - very sudden and unexpected. I felt for his wife and his clients, literally hundreds. I decided then to try to include anything necessary for a future preparer to be able to continue if I should croak tomorrow as I don't want my family to have to deal with the additional hassle and legal issues. It's an extra piece of paper or two, that's all.

[AJsTax]

I stated

I'll agree it is not required, but if asked for by the client or preparer with written permission from the client why wouldn't you hand it over?

I did not include the depreciation schedule in my clients information until 2008. We had an EA in his early 50's pass away from a stroke - very sudden and unexpected. I felt for his wife and his clients, literally hundreds. I decided then to try to include anything necessary for a future preparer to be able to continue if I should croak tomorrow as I don't want my family to have to deal with the additional hassle and legal issues. It's an extra piece of paper or two, that's all.

That I always provide them upon request with no problem.

I can see your point with the problem with the lone preparer passing away, That would be a huge headache.

[BHoffman]

I give the depreciation schedule and the shareholder basis worksheet as part of every return that gets one. Figure it's part of the information needed to prepare the return, just in case I win the lottery and run off to write bad poetry on some beach for the rest of my days.... you never know