I am in a panic - HELP - kind of a legal question

[dkss]

Situation:
Married clients, wife does not accept that her new SS benefits are taxable. After 2 months sitting in my drawer waiting for signatures, he showed up and told me he wanted to get his papers back and pay me for my time. He was going to take them somewhere else to get them done - he knew I did them right, but he had to live with his wife! He paid me my fee and signed the following paper that I whipped up on the spur of the moment:

"I, taxpayer name, have directed "my business name" not to file my Federal & State tax returns for tax year 2011. I am only paying them for their work done on the returns, we will not file the returns."

He gave me no issues or grief.

Fast forward to the following day, I had realized I forgot to give him his w-2 back, so I called and left a message apologizing and letting them know I could mail it or they could pick it up. Yesterday, she shows up to get the W-2 and then proceeds to "educate" me that her SS benefits are not taxable but then contradicts herself saying "this paper shows I have two years to pay them". Then she wanted the actual returns so she could paper file them. I told her I would have to re-do them for a paper file return, because additional documentation would have to be attached, because as a tax pro I have to file them electronically. Then she says , "I don't want to file them cause they are wrong." So, she was very confused and contradictory.

They were never given any copies of the prepared returns.

This morning, she called demanding the returns and saying her lawyer says I have to give it to them because that is what they paid for, the lawyer said I can't just charge for my time. I read to her the statement that her husband signed, she continued to threaten the lawyer action, I finally just said have him call me! I was getting nowhere with her.

I do not want to give them any completed copy of the return. Am I required to in this case? I thought the signed statement would cover me. Am I wrong? Have I opened mouth and inserted a stinky foot? Thoughts and opinions PLEASE!

Thank you very much
Very Worried,
Debbie

[Uncle Sam]

I would suggest you contact your liability carrier for advice.

[Gretel]

Why don't you just give them the copies to paper file? I don't think it is worth the hassle to battle over this. I believe you can charge for your time separate from charging for a tax return if this is made clear, which it is. We are responsible for anything we sign unless it clearly is against the law, which in my wildest dream I cannot see this situation fit in.

I also have a hunch that she does not have a lawyer involved.

[taxea]

I do exactly what you did. If the return has been completed and the client chooses to go elsewhere...I give them back their docs, charge for my time and shred the hardcopy of the rerturn as well as deleted the digital copy. The only thing that remains in the program file is the invoice for my time with an explanation of the circumstances.
This insures that the return is not accidentally filed.

[thomtax]

Agree, probably no lawyer involved. You will notice that she is the one saying that lawyer said. I would have asked her if he charged for his time since he did not file a lawsuit.

LT

[RitaB]

I like it

I would have asked her if he charged for his time since he did not file a lawsuit.

Bam! Good one.

[FEDUKE404]

Good riddance

You certainly CAN charge for your time, exclusive of the presence of any final product.

Clients sound like genuine PITAs.

As for Soc Sec, are they illiterate and/or might want to read the rules?? Oh yeah: What in the world was that "two-year rule" ???

Reminds me of years ago in a "green box" office (dark ages, no computers) when a client came in ranting/raving. Manager had already had "one of those days" and went over to file drawer, retrieved folder, found tax documents/handed to client, and then took the entire (ready to go) tax return, tore it in half, and slam dunked it into trash can.

If only I had a camera to record the look on the (former) client's face.

Hope everyone celebrates well and safely the somewhat end of the 2012 tax season.

FE

[Roberts]

I do exactly what you did. If the return has been completed and the client chooses to go elsewhere...I give them back their docs, charge for my time

I wouldn't shred anything but otherwise, it's all good.
Sound like we should all be happy we aren't married to this person.

Why on earth would they think someone can't charge for their time? That's a new one to me.

[joanmcq]

Was it disability benefits that were paid for an earlier year? maybe that's what she was refering to with the 'two year rule'.

I don't have anyone that ugly. If they are nasty, I don't need them.

[dkss]

Was it disability benefits that were paid for an earlier year? maybe that's what she was refering to with the 'two year rule'.

I don't have anyone that ugly. If they are nasty, I don't need them.

Yes, it was disability benefits that finally came through. I figured the taxes using the lump sum election, is that what you are referring to?

I didn't take the time to read the paper because I was swamped at the time and she had previously had an appointment with me to discuss the ss disability benefits - and she did not show or return any calls after that.

[David1980]

Let the lawyer call. Sounds like an empty threat to me. The lawyer probably doesn't exist.

[jimfrombx]

If she wants the return, give it to her for the Original price you were going to charge, less the fees you already received.

[FEDUKE404]

And DON'T let the door hit you...

Yes, it was disability benefits that finally came through. I figured the taxes using the lump sum election, is that what you are referring to?

I didn't take the time to read the paper because I was swamped at the time and she had previously had an appointment with me to discuss the ss disability benefits - and she did not show or return any calls after that.

There ARE some special tax treatments for scenarios where a person receives lump sum (retroactive) Social Security benefits. With a knowledge of the facts (including prior year tax returns), and some good tax software, I'm sure you could have figured it out. If there was a tax break available, extend or amend.

But for the client to basically say you are (whatever) for doing your professional job, and then shout "Lawyer!", would have likely led me in a similar situation to show her the door forthwith. One of the nicer things about being "the boss" is I CAN show some discretion as to the clients I will accept.

Illegitimi non carborundum

FE

[geekgirldany]

If you look back at some my posts a few years ago you will find I had a client have a lawyer call me. It was not a pleasant and it scared me. Thanks to everyone on the forum, they got me calmed down about the situation and nothing ever came of it.

This client never threatened "lawyer" she just had him call. Which I believe was really a close friend. He did call again and I left a message telling him any other communications will be done through letters. No more phone calls.

I think your client is crying "lawyer". I learned my lesson last time. I won't get into a big argument. I just tell them and hang up.

[RitaB]

It was a great day

If you look back at some my posts a few years ago you will find I had a client have a lawyer call me. It was not a pleasant and it scared me. Thanks to everyone on the forum, they got me calmed down about the situation and nothing ever came of it.

This client never threatened "lawyer" she just had him call. Which I believe was really a close friend. He did call again and I left a message telling him any other communications will be done through letters. No more phone calls.

I think your client is crying "lawyer". I learned my lesson last time. I won't get into a big argument. I just tell them and hang up.

It was a great day when I figured out that "my attorney said" carries exactly the same weight as "my hairdresser said".