A Schedule C Client Completely Makeup

[Maria]

Hi,

We do you guys do if you found a client completely make up numbers in order to zero out all taxes including SE tax?

I wish I were my own boss so I just get rid of it.

Thanks.

[solomon]

Refuse

I would tell client to go elsewhere.

[Jiggers]

All amounts in rounded off dollars.

You mean like:
Sales 20,000

Purchases 5,000

Telephone 1,000

etc.?

The first year I used the client's hand written amounts.

The second year I sent him an organizer and he did the same thing.

The third year I ask for substantiation of the dollar amounts. He didn't come back.

Another client, a foreigner owning a convenient store, did similar things. He had the information on a computer printout. Filed return, showed a low income, and he qualified for EIC. Filed the return and about a month later came back and said that he was worried about it and asked that I amend his return and deduct 10,000 from his cost of sales.

Next year he asked for a discount on his fee because my H & R competitor said that they would do it cheaper. I hope the door didn't hit him too hard on the way out!

When I suspect something fishy, I make sure it is in the client's hand writing and they must sign my engagement letter stating that they can document all records and that are reporting all their income.

[JCH]

Hi,

We do you guys do if you found a client completely make up numbers in order to zero out all taxes including SE tax?

I wish I were my own boss so I just get rid of it.

Thanks.

Maria, don't sign the return if you're not comfortable putting your name on it. If you're not your own boss, this is a great opportunity to make it his/her problem.

[veritas]

My rule of thumb

One zero at end of several numbesr=probably guessing

Two zeros at end of several numbers=lying

Three zeros at end of several numbers=fraud

[Maria]

Sch C Client

Hi,

Thanks for all your guys support.

Just like Veritas, there were several zeroes.

It is just too obvious. For example, if the expense last year was $550, this year it would be $650, things like that, but for her little Schedule C, gross receipts $45,000 (someone sent her 1099-Misc. so she cann't lie). she has credit card interest of $4800, somehow she forgot she already put $4800, she put the same number on office expense. Then she put $4500 for office supplies. Since last year office supplies was $375, I asked her if she means office supplies $450, she thought about it and told me she bought printer ink, some paper, that would be $4500!!!.

Obviously she is not a very good makeup person, almost all the numbers are even, such as $550, $5000, $6100.

I just hate it. For that reason I want to change job. I had chances but I stay. Partially for personal reason. Partially because my chances arrived right on the tax season started, and already several co-workers left right before that and no replacement found.

Thanks again.

Maria

[Joe Btfsplk]

Big deduction for Dog Food

Once I had a client who was raising dogs as a so-called business. He had all round, even figures for things like $ 10,000 for dog food. His losses on the dog business wiped out most of his salary. The IRS soon became suspicious and audited him. He claimed he could prove every penny of it when I questioned his deductions.