Directions, client confidentiality, and peace officers

[erchess]

Ok by now most of you know that I do much of my work in the homes and occasionally offices of my clients. I have two thoughts of what might happen that strike fear into my heart but so far neither has happened.

Suppose that I am tempted to ask directions? I'm sure asking for a street is ok and may be combined with telling someone who I am but would I be right in saying that I can't tell the specific address or client name I am looking for and also give my name and the fact that I am a tax guy? Can I lie and say the client is my friend especially if I don't mention my occupation?

Suppose that as I wander up and down looking for a street or a house the law stops me and wants to know who I am and what I am up to? I can obviously state my name and profession and the fact I am looking for the home or office of a client but can I identify the client by name or address?

[Jiggers]

Get a good GPS!

I wouldn't be concerned.

You are not disclosing anything if you are just asking for help in locating an address.

If questioned further by anyone, you can respond NOYB (None of your business) if you want.

I would just say that I have an appointment with the person at that address.

If questioned by a police officer, just respond that you are looking for an address and are unfamiliar with the area.

[JohnH]

If you get quesitoned by a police officer, just hand him your business card and whisper that you've heard that IRS is targeting police officers in your county with special in-depth audits. Urge him to keep your card handy if he should need it in an emergency.

That should distract him enough not to ask you any questions you might not want to answer.

[taxea]

what you are doing is totally acceptable. we often cannot find what we are looking for even when we are standing in front of it.
The confidentiality comes when you disclose information on the person's tax situation and identify who you are speaking of.
I don't see anything wrong with telling a police officer "I am meeting with a client and can't seem to locate his address". You aren't disclosing any confidential information by using the address, or even telling him/.her your job if he/she asks as long as you don;t disclose specifics of the clients tax situation. And you don't have to tell anyone that the person you are looking for is a police officer.

[dtlee]

what you are doing is totally acceptable. we often cannot find what we are looking for even when we are standing in front of it.
The confidentiality comes when you disclose information on the person's tax situation and identify who you are speaking of.
I don't see anything wrong with telling a police officer "I am meeting with a client and can't seem to locate his address". You aren't disclosing any confidential information by using the address, or even telling him/.her your job if he/she asks as long as you don;t disclose specifics of the clients tax situation. And you don't have to tell anyone that the person you are looking for is a police officer.

I basically agree with this.

However, the "specifics of the client's tax situation" are not identical to the definition in the regulations for "tax return information" which includes things that may not even be reported on the tax return (such as the client lost his job, is planning to retire, is expecting another child, or anything else which might be learned with a tax return engagement). Thus, I can understand the concern about not divulging too much.

The question of whether or not the preparer/client relationship itself is confidential is a question that also often comes up.

The IRS was trying to protect identities of clients from the preparers who might want to go up and down the block saying, "Hey, I'm Preparer X and I prepare so and so's tax return and am looking for their house. Here's my card as proof and you can keep it if you ever need a good tax preparer. Can you tell me which house it is?" While, that scenario is somewhat preposterous, there have been situations where the preparer/client relationship was used to drum up new business, so the IRS is somewhat concerned about us revealing that relationship which can make situations like this questionable. If I ever ask for information, I do not reveal specifics and I have never been challenged. A crook would likely have a good lie anyway. I just say, "I am looking for 123 Fourth street and cannot find the house, do you know which one it is?" I think most people assume I am a construction contractor and are just glad I didn't offer to make repairs to their home.

However, while the IRS does not specifically allow sharing that information with a peace officer who stops you, the IRS has realized that there are holes in their rules. I know of a community where the small village police force knows every car and resident and routinely stops any "foreign" car which happens into the neighborhood. They have accepted vague statements like, "I have a business appointment with Mr. So and So," since the privacy of their residents is even more important than any privacy concerns you might have. When pressed, you might consider that if the information would have been allowed to be ordered by a court, that may be an acceptable argument to be covered under:

Disclosure pursuant to an order of a court, or an administrative order, demand, request, summons or
subpoena which is issued in the performance of its duties by a Federal or State agency, the United
States Congress, a professional association ethics committee or board, or the Public Company
Accounting Oversight Board. The provisions of section 7216(a) and §301.7216-1 will not apply to any
disclosure of tax return information if the disclosure is made pursuant to any one of the following
documents:

When I spoke to the IRS, they agreed that we must give such information to our E&O Policy Issuers and that it is not covered by the regulations, but they noted that this is information which could be subpoenaed, and they would likely accept that argument if we did disclose the information.

Personally, I have asked for directions dozens of times without revealing the nature of business I am carrying out. I even knocked on the door of the right numbered house on the wrong street (my GPS was off a block due to poor satellite reception). I do not believe that the people understood what my appointment was for and they did not care.

[taxea]

I basically agree with this.

However, the "specifics of the client's tax situation" are not identical to the definition in the regulations for "tax return information" which includes things that may not even be reported on the tax return (such as the client lost his job, is planning to retire, is expecting another child, or anything else which might be learned with a tax return engagement). Thus, I can understand the concern about not divulging too much.

The question of whether or not the preparer/client relationship itself is confidential is a question that also often comes up.

The IRS was trying to protect identities of clients from the preparers who might want to go up and down the block saying, "Hey, I'm Preparer X and I prepare so and so's tax return and am looking for their house. Here's my card as proof and you can keep it if you ever need a good tax preparer. Can you tell me which house it is?" While, that scenario is somewhat preposterous, there have been situations where the preparer/client relationship was used to drum up new business, so the IRS is somewhat concerned about us revealing that relationship which can make situations like this questionable. If I ever ask for information, I do not reveal specifics and I have never been challenged. A crook would likely have a good lie anyway. I just say, "I am looking for 123 Fourth street and cannot find the house, do you know which one it is?" I think most people assume I am a construction contractor and are just glad I didn't offer to make repairs to their home.

However, while the IRS does not specifically allow sharing that information with a peace officer who stops you, the IRS has realized that there are holes in their rules. I know of a community where the small village police force knows every car and resident and routinely stops any "foreign" car which happens into the neighborhood. They have accepted vague statements like, "I have a business appointment with Mr. So and So," since the privacy of their residents is even more important than any privacy concerns you might have. When pressed, you might consider that if the information would have been allowed to be ordered by a court, that may be an acceptable argument to be covered under:When I spoke to the IRS, they agreed that we must give such information to our E&O Policy Issuers and that it is not covered by the regulations, but they noted that this is information which could be subpoenaed, and they would likely accept that argument if we did disclose the information.

Personally, I have asked for directions dozens of times without revealing the nature of business I am carrying out. I even knocked on the door of the right numbered house on the wrong street (my GPS was off a block due to poor satellite reception). I do not believe that the people understood what my appointment was for and they did not care.

I speak from a former law enforcement background. An officer who stops a ped and after determining the house may ask what the person's business is only for safety issues if that officer knows that the house resident is a police officer. If told, simply, I do taxes, that should satisfy him. Give him a card you may get a new client if the one you are looking for tells him how good you are.

[luke]

bigger concern

I would think a BIGGER concern for you should be what happens in a client's home - what if you're accused of theft, sexual harassment, fall down and get injured, attacked by pets? - Seriously you are exposing yourself to MANY potential problems by working IN someone's home! Would these be covered by YOUR workers comp?, homeowners liability insurance? your professional liability insurance? maybe/maybe not....

[erchess]

Insurance

I'd be protected by my E & O insurance if I got sued for anything arising out of my tax work or a tax related visit to the client's home. I'd be insured if criminally prosecuted for the work I was paid to do but not if criminally prosecuted for stealing something other than tax related records from a client. I don't know if I'd be covered if sued or prosecuted for allegedly "casing the joint" while there to do a return and later returning surreptitiously for illegal purposes. If I got hurt on the job I'd have the same resources I'd have if I got the same injury off the job but I don't have worker's comp insurance. I don't believe I am required to have it and honestly I think I am much more likely to be hurt on my own time than while working.

[Burke]

Wow, and I think back to all those years I did that. Heck, they even left the key under the mat for me before they got home, told me to go on in and start -- "everything's on the kitchen table"....

[taxea]

I would think a BIGGER concern for you should be what happens in a client's home - what if you're accused of theft, sexual harassment, fall down and get injured, attacked by pets? - Seriously you are exposing yourself to MANY potential problems by working IN someone's home! Would these be covered by YOUR workers comp?, homeowners liability insurance? your professional liability insurance? maybe/maybe not....

You are covered by the home owners insurance. For the convenience of the client, if I have to meet with them it is at a place of their choice and time. They do not come to me.