Dealing With New Customers

[geekgirldany]

I may have asked this before and if so please pardon the repeat.

I just had a call from a new customer to do a S-Corp return. Only thing is after talking on the phone things just did not sound right. It is a situation where things went very very bad between the shareholders. I did set an appointment but I believe I will send him somewhere else. I just don't fee like it is worth it getting involved in something that could get even worse and involve me.

How do you all deal with situations like this? If you get the person in your office and all this stuff starts surfacing that you did not know about do you just tell them to go on to another tax preparer?

Just wanted a little feedback because I am getting more of these types of customers. Maybe I should take a customer service course.

[JohnH]

Intuition

Most of the time when I've failed to follow my intution regarding a new client, I later regretted it. I'm guessing that you will find many more problems when the client sits down with you. So if your meeting turns up additional problems, which it probably will, your best course of action will probably be to tell them your practice just isn't geared toward handling their sort of situation, especially at this time of the year.

I don't think a prospective client is owed any detailed explanation when the accountant sees things they don't like or don't want to deal with. We're independent businesspeople and can operate in whatever manner we see fit, within the bounds of the law and ethical behavior.

[Black Bart]

Generally speaking,

I'm with John (and you) on this -- your first instinct is usually right, so I'd get rid of them. You can tell them you don't want to be in the middle of a dispute. Then they usually tell you there's no problem, so you have to say that you think there is and you can't do their taxes. They'll probably be mad, but you can't help that. If you don't want to go through that, then just make the usual excuses -- it's more complicated than you thought it would be, or it's tax season and with your workload you don't have time to start a new project.

When clients aren't getting along, they're usually mad at everybody including agents hired (you) and all affiliated parties. So these things can be professionally dangerous, as they may sue for any little misstep you make. That hasn't happened to me yet, but you never know so I'm always looking for it. Last year I turned down a squabbling multi-family case and I've been grateful ever since that I listened to my inner chicken because that one later turned into a mini-Hatfield/McCoy drama involving a shotgun and the sheriff.

Although I agree I'd reject your client, I'm of two minds about such situations. Several times when I did take "problem cases," they weren't as much trouble as I thought and I had to do some digging, research, and confront issues on which I was "rusty." I felt it was beneficial and stimulating to my professional growth; evolving into a learning experience -- it "broadened my horizons" you might say.

Too, I've noticed that the older I get, the more my decisions about perceived "problem cases" reflect a desire to a avoid pain rather than anything else, so taking the cases counters that negative habit to a certain extent. But, how do you know which ones are good and which ones...

[winnie]

I think you have consensus. If you have a bad feeling, don't take it on. If you don't want to deal with their particular situation, use any line you choose. Not taking that particular type of client, not in tax busy season and one that is hard to dispute: I don't feel qualified to take on your complex situation.

Good luck

[Black Bart]

P.s.

This is where Block (bless their hearts) comes in handy. While occasionally suffering from pangs of conscience, I find that I can live with it,

I have frequently made the following speech to a potential P.I.A. case: "Look, you've got a complicated and complex case here and you need it done pretty soon, but I can't get into something like this right now. I'm all tied up with short forms and it'll be several months before I can even look at it. I'm a one-man office here and can't give this the attention it needs. I suggest you check with H&R Block down the street on this -- they've got a large staff and can probably do it in a few days. Plus, they have a consulting staff of Kansas City lawyers in case anything comes up on it. And they've got good prices; usually more reasonable than anybody else around. Give them a shot and I think it'll work out fine for you. No, no -- no charge for the consultation and good luck to you."

[DixieEA]

Hrb stock?

Hi BB, do you own Hrb stock?

DixieEA

[Kram BergGold]

Call client immediately

After reading the posts, I am confident you are not going to work with this client. You should call and tell the client that upon reflection you realize the issues involved are beyond your abilities or something to that effect and he should get help from a more experienced or knowledgable source. Do not have the client come in and then bail..

[JAinNC]

Good Point

Don't mess around and use up your time.

At times when I have discovered situations in the office during an appointment - like 3 partners who don't speak to each other or 1 shareholder has not properly accounted for an accoutable plan I have a set plan of action.

Usually, I say " I cannot act as your mediator - therefore you need to continue your search for a tax professional". End of discussion.

I did have one corp who hired a manager to be their mediator after I said that. Later when they came back to me - their biusiness was doing great and they are now very good clients.

[geekgirldany]

Thank you all for posting. I have tried several times to get him today but no luck. I finally just left a message. I basically put it on myself that I did not have enough experience and he needs to find someone who knows more about different corporations.

I am happy you guys posted your experience. It is usually after the fact that I find out these things and they are already in the office. I need to stop being so nice and lay down the law I have a hard time saying no especially when the person is sitting in front of me. I've always tried to help people but geez these are just situations you don't want to get involved in.

Thank you again

[Lion]

Good Decision

It sounds like you made a good choice for you, Dany. When I have doubts, I sometimes ask to meet with ALL principals, sometimes even at THEIR place of business. Otherwise, the one you do NOT meet is the crazy one or the super controlling one or the law breaker or the needy one or... When I have doubts, I just use a short and simple excuse such as no new clients during tax season or no new corporations/whatever they are during tax season or suggest a CPA or tax lawyer or HRB or whatever might be appropriate for their situation.

[geekgirldany]

I just got off the phone with him and he said he understood.

I think alot of times people know what they are asking of you... you just have to tell them you won't do it. I've found it difficult in the past but I think now I am finding my voice

On another note we have a winter storm coming tomorrow in GA. 1 to 3 inches of snow. We had a little wednesday.

[Black Bart]

Thank for the interest, Dixie,

Hi BB, do you own Hrb stock?

DixieEA

but no, I've temporarily sworn off the stock market since all my portfolios folded and I'm looking for any port in this storm. I'm seriously thinking of investing in a Nigerian scam -- it can't do worse that my stock picks.

Regards, Bart

[thomtax]

Scam

Bart,

You might try starting a Nigerian Scam. Maybe that would be profitable. When the economy goes down, people get desperate and start grasping at all kinds of things.

LT

[Snaggletooth]

Disagree - Geeko

Geekgirl, I'm going to surprise everyone and disagree about turning down this client. There are things that can work, given proper circumstances that you should explore before categorically rejecting this potential client.

Firstly, you said this was an S corp. That means your communication and obligation can be restricted to the Chairman of the Board of Directors. Even if they are a small corp, there should be one person authorized more so than the rest to act for the corporation. This means you have no obligation to the others, and you don't have to get in the middle between the Hatfields and McCoys. I'm not trying to minimize the obligation to the corporation, or the obligation for due diligence, but you have NO obligation to be a pin-ball machine for all the shareholders if you are dealing with one person who is authorized. Maybe NONE of the owners will own up to being "Chairman of the Board" but in all 50 states there is such a default person -- if nothing more than an "agent for service."

Secondly, you can charge more because of the mess. And you can be very up front about it, telling the "chairman" that the fractured ownership will result in more time and trouble. Get money in advance, or at a minimum, get paid-as-you-go.

Thirdly, if you are in a small town, be wary of some of the other stockholders who may have "elliptical connections" in the town. There are people so powerful in my town that they can run me out on a rail if they wanted to, and I wouldn't be able to stop them in court or in any other fashion. If you have this situation, tell the guy to go out-of-town to have his taxes done.

Surprised? There is a lot of talk on this forum about "firing our clients" or effectively "not getting our hands dirty" with this or that situation. However, under this mindset, you would think that good, squeaky-clean, problem-free clients just fall from the sky. They simply do not, and that is the truth. Tackling a difficult problem and bringing forth order out of chaos will spread your reputation. And you can do this without compromising your ethics and moral fiber.

[Black Bart]

Well shoot, KB.

After reading the posts, I am confident you are not going to work with this client. You should call and tell the client that upon reflection you realize the issues involved are beyond your abilities or something to that effect and he should get help from a more experienced or knowledgable source. Do not have the client come in and then bail..

You're the unofficial conscience of the board and you do make me a tad sheepish about casting them to the winds/whatever. I suppose we could do better, but still, when the truth comes to light about such cases, I usually find that my sympathy was misplaced because they simply didn't want to fool with the mess. Too, when it comes to fees, problem cases often don't want to pay you jack -- most people aren't stuipid about money and you've got to watch those naive, noble pore boys or they'll take your britches off.

Often they turn out like Lion describes them above and I haven't dealt with one yet who was naively unaware of the serious problems he was trying to dump in my lap. I'm just sayin' that the majority of these guys have created an extraordinary problem by extraordinary megligence or malfeasance rather than blindly stumbling into it, and therefore I'm not shedding any tears about it.