Getting paid up front

[erchess]

A new client is in enough deep doo doo that I ham going to insist on being paid before I work. I have never done that before and I have questions.

I would like to make the money he pays me nonrefundable. I will be clear in my engagement letter that this is so. The terms will be that he makes a payment then when I have done all the work that entitles him to I will stop until he gives me another payment and then resume. He can naturally fire me at any time but the moneys I have received but not earned by working will be a a what? Nuisance Fee? Cancellation Fee? Seriously will the law and professional ethics let me go this route?

If I must allow him to claim back money he has paid me but I have not charged off when he fires me then is it ok to stick the money in my regular business checking account which pays interest and not pay him interest on what he gets back?

Thank you very much.

[S T]

Just a thought ---Retainer?

Definition:
A retainer is a fee paid to an attorney or other professional in advance, for services. Often, retainers are paid monthly, based on an estimate of the amount of work to be done for the client each month.

Here is also a link to an EA website that talks about fees http://www.dicknorton.com/fees.htm

Maybe this will be of some help - I am sure some other Board Members will also post.

Sandy

[taxxcpa]

Often attorneys receive retainers from companies that never intend to use their services just to make it a conflict of interest for the attorney to represent someone wants to sue the company.

If you do some work and the client decides to have the work discontinued before you complete it, I see no reason why you should refund it unless you have agreed to it in advance.

[AZ-Tax]

Basic tax research

Over the yrs I received some calls from taxpayers (not established clients) who need some research done and I always charged an upfront amount usually 50% of what I estimate its going to cost. To try to lure the taxpayer to become my client, I usually credit 50% of my total amount paid to me toward their tax prep fees. Most of the time it works but in some cases it does not usually because the taxpayer did not like my answer. Yrs ago I have been burnt on prospects promosing they will hire me to prepare their tax return if I answer their questions for free so NEVER again will I do that.

[ttbtaxes]

I would treat the advance payment as a retainer and submit invoices twice a month against that balance for any work you do. The client will quickly see that setting up files and answering phone calls add up to real dollars. That should flush out those nibbling around the edges.

If you suspect the client is a royal pain in the neck, then I wouldn't take him on at all. When a client jerks us around, I don't think that gives us license to keep his retainer. It does, however, mean we can bill him for the time he plays those games.

[taxea]

A new client is in enough deep doo doo that I ham going to insist on being paid before I work. I have never done that before and I have questions.

I would like to make the money he pays me nonrefundable. I will be clear in my engagement letter that this is so. The terms will be that he makes a payment then when I have done all the work that entitles him to I will stop until he gives me another payment and then resume. He can naturally fire me at any time but the moneys I have received but not earned by working will be a a what? Nuisance Fee? Cancellation Fee? Seriously will the law and professional ethics let me go this route?

If I must allow him to claim back money he has paid me but I have not charged off when he fires me then is it ok to stick the money in my regular business checking account which pays interest and not pay him interest on what he gets back?

Thank you very much.

I do this too. When working wth compliance clients the initial fee/retainer is based on my normal prep fees plus research time, POA, IA and other expenses necessary in order to get all returns filed. The second retainer is for OIC services and allows me to continue working on the issues while waiting for the returns to be processed by the tax agency. I charge by the hour plus expenses.