White Oleander

[Corduroy Frog]

New thread because original thread has several responses, and I wanted to respond to you directly. I am aware you work for HRB, and I also believe you bring a high level of expertise to the board. I want to more fully explain why I'm concerned about storefronts being held to the same standards, lest anyone think my purpose was Block-bashing.

Where I'm headed with my comments is the IRS is a typical govt agency with zealous bureaucrats anxious to earn a gold star. It's no secret that the overwhelming criteria for raises and promotions is how much revenue an agent can bring in. Small service providers are an easier target to push around than larger, well-heeled companies.

I have a long background in various arenas of accounting. I worked as a staff accountant for a large Fortune 500 company who was audited for expense items which realistically should have been capitalized. When the auditor proposed adjustments to our Comptroller, he was told "our lawyers will be in touch..." and we never saw the auditor again. This response was 180 degrees different with audits of smaller companies trying to fight IRS positions that were frankly quite ridiculous. In most cases, the small companies had to cough up money.

I can relate a number of examples of bank auditors auditing small banks. While they make life miserable for small bankers, their shadow is never seen on the doorstep of Bank of America, Citibank, Chase, etc.

I am impressed to know that HRB is having the due diligence with the EIC crowd, because I was appalled to see how these people bring their ridiculous cases to the storefront. And I appreciate your responses and the level of diligence you do.

But what I would REALLY like to know is whether any HRB (or JH or Liberty) office is having their preparers actually audited by the IRS. And if so, what the results of such audit turns out with proposed penalties, etc. Will the result be taking the preparer to the cleaners, or will the auditor be chased away by "our lawyer will be in touch..."

What I'm really bashing here is the injustice of IRS treating small preparers as "low hanging fruit" and shying away from larger entities. Very much like city police setting up speed traps where it is easy to stop an out-of-state car than setting up where it's difficult to apprehend a car in traffic.

[snowshine]

I'm also at HRB and was in no way offended by your comments. Locally, we have a franchise owner (I'm in a company owned premium office) currently undergoing an EITC examination for her 2 stores. It is not going well for her so far! Here at the company-owned side of things, we had a preparer (EA) audited last year and the matter was dropped when she agreed to retire. Our local JH lost his efile liscence a few years back and paid a big fine, so it seems like they at least look at everyone, even if some are treated differently.

[Snaggletooth]

Form 8867 Redesign

If IRS expects us to ask questions that are subjective on the part of the preparers' due diligence, then why don't they solve the problem by?

Redesigning Form 8867 such that these questions (school records, ss#, utility bills, whatever) appear on the form itself, and the EIC will be disqualified without proper execution of the form. Oh yes, some of this stuff is on various checklists, but the form would be self-substantiating rather than putting the preparer in a position to audit the taxpayer.

[WhiteOleander]

I was not offended in the least by the original comments. I just wanted to point out that some of the offices actually try as hard as possible to keep everything straight. In my view, it is like McDonalds. Some that you might go to are exceptional and the food/service/atmosphere is great. Some not so much.

As far as the IRS giving Block a pass, I respectfully disagree. Two years ago in Dec., just as we were getting ready to begin the tax season, the IRS pulled the ability for Block to offer RALs. (this is not about how ethical RALs are. i don't like them either). However, they did not stop anyone else in the US from offering the loans. It blindsided us. We lost a lot of clients. The IRS made an arbitrary decision. Block tried to turn it around and was not successful. The other companies have been allowed to continue doing loans through this year. Block is not allowed. No explanation has been given.

So, Block is not given preferential treatment in my opinion.

[Gretel]

I am so glad that this issue is addressed! Even having no knowledge what happens with audits and such at bigger companies I always had this underlying suspicion of what Snag is addressing. Now, that can go to rest.

On a side note, I feel we all should fight ridiculous IRS agents, laws and regulations, at a minimum write supporting letters or e-mails to professional organizations. If we want to do something more than write to our congressmen. The first thing I have done, the second not yet. This is the only way to fight the looming fear.

Snag, I hope you don't mind me somewhat changing the subject.