Refunded TP fees but TP rejected refund, mailing in tax return

[AZ-Tax]

I should have never took this client in the first place She never showed up with the documents to support her self employed exps and a few other things that has made me extremely uncomfortable. Then I got busy, went ahead e-filed her return and it got rejected due to someone else used her ss# for which she said it maybe her mother now she thinks its fraud That happen Apr 16th and I had to file an ext for her on Apr 17th but now I prefer not to be the tax preparer on her tax return and offered to return her fee ($150) but she will not accept my refund and plans to mail in the tax return with my signatures on it but she said the IRS told her she needs the reject document which I still have. What are my options?

Spoke to Ms Cox @ IRS #........ and she sited IRM (Internal Revenue Manual) 21.1.3.3.1 paragraph 8. She suggested I mail a letter to the IRS stating my request and the reason for my request of being revoked as third party desingnee and/or paid preparer. Mail to the address for which that tax return would have been mailed if paper return. I was on the phone with her quite a while and she put me hold a few times to check, this and that, talk to her manager etc. From all the times I talked to the IRS, this ranks up there with productive. Now I could not locate exactly what she was reading from for she was reading from anothe website.

[oceanlovin'ea]

Mail her a money order by certified mail to return her fees. I suggest a money order because that would take the money out of your account. If you send a check she might just not cash it. I would not have given her a signed return but since you did you will have to deal with that situation.

Since you have refunded her fees, I believe that you can send a letter or a form to the IRS that says you were not paid for the return so please take your name off the return as the paid preparer. I have heard of people telling clients they would do that when they wanted to scare them into paying for a return. So it might work for you.

Linda, EA

[AZ-Tax]

Update, see my update on initial thread.

Update, see my update on my initial thread.

[taxea]

I don't see a reason why you would want to refund the fee since you did the work. All you need to do is submit the reason not efiled form and if the client thinks it is fraud she should report it to the IRS. I believe there is also a form for that which should have been attached to the return after it rejected.
The IRS is finally being very diligent about investigating the fraudulent use of SSN's. It certainly isn't anything you had control over that caused the return to reject. If you prepared it correctly I see no reason not to let her paper file it.

[erchess]

Why refund

He states in the opening sentence that he didn't insist on seeing documentation of self employed expenses and other things where his gut told him he should. That's why he wants to not be legally regarded as the paid preparer of the return. If you're going to take your name off as the nice lady at IRS suggests, he must refund the fee. If he didn't refund the fee I think his getting his name off the return would be questionable even if the process didn't involve certifying that he wasn't paid for doing it. With that proviso if he doesn't refund the money he has lied to the IRS which would be a clearcut violation of Circular 30 whereas the conduct he is trying to walk back was only questionable behavior unless there is something in the post I'm missing. (I'm under the impression that I have to see hard proof for claiming EIC, claiming deductible mileage, and claiming charitable donations but on other issues I may trust the client unless facts and circumstances tell me otherwise.)

[FEDUKE404]

Three questions

1 - If only an extension, and a rejected efiled return, have been prepared then there currently is NO existing income tax return to create undue concern. Where is the problem re "incorrect" (filed) tax return?

2 - Why (try to) submit/efile a tax return that you apparently had many reservations about in the first place??

3 - How did she (apparently) get a paper return, with your signature on it!!, that she would actually be able to file on her own? I do not sign the client's copies, and what they receive also has "DO NOT FILE - CLIENT COPY" in very large letters.

As for the return of fees et al, that is a separate matter. I would think that, in this case, the loss of income and the riddance of the client would just about neutralize each other.

FE

[RitaB]

Two cents comin at ya

I believe there is also a form for that which should have been attached to the return after it rejected.

Form 8948 is the one that gets attached to the mailed copy to explain why tax preparer did not e-file.

The Form (that is not in my software - ATX - yay) for identity theft victims is # 14039.

1How did she (apparently) get a paper return, with your signature on it!!, that she would actually be able to file on her own? I do not sign the client's copies...

I thought there was a $50 per return penalty for failure to provide the taxpayer with a signed copy of a return. (And a stamp or computer generated signature is ok.)

[AZ-Tax]

Yes, I messed up

Here I am several yrs later and I still make mistakes and this one I should have picked up on and avoided this client altogether but we live and learn and obviosly I am still learning. I got very rushed last week of tax season and forgot to follow up on this TP. Today the TP is coming in and I have for the TP, a cashier's check and copy of e-file rejection letter. I am having the TP sign that TP received both and in addition, the TP must return all tax forms I printed for her including ones I signed (originals) and any copies TP made. TP late yesterday informed me TP still has all tax forms. Yet there is no guarntee TP will accept the refund check. I must tell you I never had a client nor do I ever want a client like this again. Your are correct, the IRS status with this TP is an ext was filed, not a tax return due to the return was rejected. I told the TP, you can self prepare or contact a preparer and you may obtain some good discounted fees since its the off season. The TP prepared its 2010 tax return. As it stands now, there is NO income taxes due so its has more to do with the TP's character.

[okie1tax]

Signature on e-filed return

Suggest you take a look at Pub 1345, Chapter 1, Page 3 (if you look at the pdf, it will be page 6).
Basically, a "signed return" is a signed Form 8879.

[RitaB]

I guess

Suggest you take a look at Pub 1345, Chapter 1, Page 3 (if you look at the pdf, it will be page 6).
Basically, a "signed return" is a signed Form 8879.

I guess I better quit relying on stuff I knew in the 80's. But, those were some good days, huh? LOL. Thank you.

[JohnH]

I'm not quite in my 80's yet, so I don't know what I'll know then - but I'm very alert right now.

[RitaB]

Let me tell you

I'm not quite in my 80's yet, so I don't know what I'll know then - but I'm very alert right now.

Well, you can look forward to forgetting what you were going

[BHoffman]

I'm not quite in my 80's yet, so I don't know what I'll know then - but I'm very alert right now.

Be alert. We need more lerts.

[AZ-Tax]

Final Update

TP made meeting, handed me all original tax forms with my original signatures and all copies TP made (can never tell about all the copies). Signed receipt she recieved $150 cashier check with my firm the remitter and E-file reject document.

DONE but quite the learning experiece.