Doing Clients by Mail

[Black Bart]

Say Fuzz,

How do you know who your talking to, if you've never met them. 8879 instructions indicate "You should confirm the identity of the taxpayer(s)". Let's hope they don't live in Nigeria.

Do you make everybody that comes in your office shuck out some ID? I know rules are rules, but most of my guys aren't e-filing and I pretty well know everybody that darkens the door around here. Lemme see, now; if somebody swiped somebody's W2 and came in claiming to be John Doe with a new address -- hmmm, well, I guess they could maybe pull off a refund scam.

Does anybody/everybody else here strictly demand ID for any/all/partially?

P.S. If it's from Nigeria, just tell them it's a double charge for out-of-state returns.

[winnie]

Interesting comments today

Just to clarify - I wouldn't take a new client that had not been referred to me and that I had never seen. I have several partners from a large law firms downtown. When they become a new partner, the older guys give them my contact info and we talk by phone and decide whether to proceed or not. I have 2 this year that I have never seen.

But if someone called from the phone book and wanted to do the same thing, I wouldn't accept that. Most of my "by mail" clients are ones that I have known for a long time and they have moved, but I still do their tax returns.

I won't efile without original w-2s on file in my office,

Good discussion - thanks for all the comments.

[ED SMITH]

original W-2's??

How does anyone know what is an original W-2? You can buy the forms at a stationery store and fill in the blanks. Someone can optically scan those neat ADP forms and alter the numbers.

In fact, the IRS is scammed from prisons with inmates doing these very things.

If you mail file after July, you could file without docs as the IRS will have most of the data, except for some K-1's. They only need the W-2 if you want a refund as soon as possible.
A large number of states including California don't require W-2's.

I have prepared numerous delinquent returns and hardly ever bother with the W-2's and the clients have never had a problem.

[fliszt]

Black Bart, I do

request S/S cards for dependents. For the tp/spouse I require some financial organization papers showing they have an account there which will also work for me for the dependents in the event tp can't find s/s card. But I'm not hard-nosed about it. Reasonable explanation will be accepted.

[ChEAr$]

Id

Do you make everybody that comes in your office shuck out some ID? I know rules are rules, but most of my guys aren't e-filing and I pretty well know everybody that darkens the door around here. Lemme see, now; if somebody swiped somebody's W2 and came in claiming to be John Doe with a new address -- hmmm, well, I guess they could maybe pull off a refund scam.

Does anybody/everybody else here strictly demand ID for any/all/partially?

P.S. If it's from Nigeria, just tell them it's a double charge for out-of-state returns.

Heck no. Most all my clients are those of longstanding whom I (should) recognized on the street.
New clients are all referrals, and just by talking to them about the guy who referred is enough
validation.

[joanmcq]

Most of mine are referrals. I've got a few that are coming in because of an ad I placed in a specialty yellow pages, but I usually see them at least once (I did have a long-time client whose wife I was starting to wonder if she was a figment of his imagination..all I ever saw was her W-2 until last year she showed up at my door to pick up the return saying 'I bet you were starting to wonder if I existed'). Some of my long distance clients I've had a relationship with in some form before they asked me to do their taxes. I've never asked for SS cards but I don't have walk-in type of clients.

[Black Bart]

That

request S/S cards for dependents. For the tp/spouse I require some financial organization papers showing they have an account there which will also work for me for the dependents in the event tp can't find s/s card. But I'm not hard-nosed about it. Reasonable explanation will be accepted.

sounds like a good approach, Larry. I also ask for SS cards for dependents because we know the cards are accurate and sometimes numbers written down are not, but also the kids are sometime claimed by people they don't really belong to (getting the card may not stop that, but it frequently prompts a good discussion about the kid).

Actually though; about not knowing who you're talking to; that's something I really never gave much thought to, but probably should. Any Tom, **** (sorry -- the censor got you-know-who), or Harry could swipe a W-2, change the address, tell me he's so-and-so, use his own address, then later sign and cash the check. It's like pulling teeth to get those forged signature checks reimbursed by IRS.

Maybe we should ask for drivers' licenses from the shifty-eyed bunch.

P.S. Just thought; if we did not verify the identity of a crook who made off with someone else's refund, would we then be in violation of the confidentiality rules for discussing that W2 with the thief?

[mblatour]

this whole conversation makes me wonder....

about a lot of things. I'm still fairly new (4th season) and trying to get more hard-nosed about how I run my business. I've started scanning client's documents and saving them on file (backing them up on external drive as well). I want to do as much as I can to protect myself but never quite know how much to do.

I had a return client come over yesterday and they just seem so fishy to me. Last year I went to their home to pick up their info. and also deliver the returns when I was done. They filled out an organizer for me and I kept copies of their handwritten notes. I met only one of their two daughters and I did not meet their two fostersons. They gave me DOB's, SS#'s and so on for all. The husband makes $18K from one job, $7000 from unemployment, and they qualify for EIC and MN Working Family Credit. All in all they pay under $800 in taxes and get back like $6000.

The husband even said to me last year, "if you do a good job and get us lot's of money back, we'll come back to you next year". I informed him that it is not up to me who gets what. If it were, he'd get nothing more back. Like I said, I had a fishy feeling. They had previously used H&R Block to do their returns.

The wife said to me "it doesn't pay for me to work. We'd just lose our big refunds". I was appalled, but yet said nothing. Mind you the kids are 13, 15, 19 (full time student) and 21.

I guess I just hate not knowing if I should be doing more backround work. I see their bigscreen TV, big garage that the husband looks as if he does side jobs out of and many other "fishy" things going on. Do I have any responsibility to have them produce me any more information than I've already received? I've seen their mortgage statements, end of year bank statements and so on. I don't go long form with them because their income is already reduced to zero by the standard and the exemptions. Or am I just being judgmental?

What do you all think about this scenario? Any advice?

[mblatour]

Bart

do you ever have issues when you ask for them to produce actual SS cards for the kids? I've got my kids cards in my safe, but I'm sure a lot of folks couldn't tell you where they are. They just go by the numbers that were written down on a prior year tax return.

[Black Bart]

Checking 'em out.

...not knowing if I should be doing more backround work. I see their bigscreen TV, big garage that the husband looks as if he does side jobs out of and many other "fishy" things going on. Do I have any responsibility to have them produce me any more information than I've already received?...am I just being judgmental?

Well, you may be a little judgmental, but so what? Environmentalists tell us that all God's creatures are in some way beneficial, but I'm still careful around snakes. Given the circumstances and environment you describe, it's a good bet the guy probably is working a "side" business out of the garage and cheats right and left. As one clown wisecracked, "Just because I'm paranoid doesn't mean they're not after me."

But that aside, no; it's not your responsibility to check out the guy's lifestyle/background (he's not hiring an auditor). He says here's what I made and you write it up if it looks halfway reasonable; asking appropriate questions where necessary.

What I would do is get a statement/document that this is his "total income from all sources." I don't how others do theirs, but I use a short engagement letter (that way they can't claim it was too long to really read it) which lists my "terms of service" and has a blank spot at the bottom which I fill in with the sources/net amounts of income/ dependents they're claiming/ filing status they're claiming/ anything else relevant. They're basically swearing to me that "This is all of my income." It's some trouble to do and it may be overkill, but having it helps me sleep better.

About the SS cards, I ask for them -- half the time they have them. If not, but they look okay, I don't insist. For fishy folk I just say we have to have them and stop talking. Sometimes they just leave (nobody's cursed/punched me out yet), but if the refund's big enough it's surprising how many will go "find" those "lost" cards.

[myerstaxes]

I have a few clients I have "Never" seen...One is an elderly lady that has had numerous strokes...She was referred to me by a dear friend who is a lodge brother to her son...Those types (usually referred to me by my former IRS co-workers who live far away) I do not mind...I get more documentation than I ask for, so I do have what I need and trust what I have...

As for identification, my client base is mostly located here in my little suburb, and they are referrals...I have a home office, so no walk-ins either...

Now about the couple with the foster children...If they are in CA, they get big bucks for those foster kids...I know of people who do not work a regular job, cause they have several kids and get at least $900 or more a month per child...Well, of course that is a job in itself...and it is tax free monies too boot!

[Black Bart]

Say Myer,

...referred to me by my former IRS co-workers

Where/what department in IRS did you work at? Lots of us here would like to know more about the inner workings of the IRS, but that information is hard to come by since we hardly ever get to talk to agents other than the phone reps. Anything interesting you can tell us about our friendly enemy?

As for identification, my client base is mostly located here in my little suburb, and they are referrals...I have a home office, so no walk-ins either...

I envy you your peaceful business environment -- this place has been a madhouse for two days. I have to give credit to those Jackson-Hewitt guys down the steet (they're better men than I am) that stay open 'til nine every night rasslin' with that RAL crowd of raffish oafs.

...about the couple with the foster children...If they are in CA, they get big bucks for those foster kids...I know of people who do not work a regular job, cause they have several kids and get at least $900 or more a month per child...Well, of course that is a job in itself...

I had a couple of clients who used to do this and they were really raking in the dough taking care of three or four "special needs" kids each (several thousand a month), but they quit it when the government started sending them kids with mental rather than physical problems (had to get up in the middle of the night, go to the police station, and help chase them down).

[fliszt]

mblatour, yes

I had a couple 2 yrs ago that I asked for s/s card for their infant, who the mother was holding. They were a son and daughter-in-law of a couple that I'm going to mention later. She said she could not find the s/s card. I told her to go to reapply for a replacement. She said that had to be done in person and didn't have the money for gas to go to town. (they were driving a new SUV) I said I would pay for the gas. (sometimes I get rather indignant with a client). (They had nothing to show the infant was theirs.) Guess what. They didn't come back last year. Now, the "father".

The father of the above son is a carpet layer. He has about a dozen W-2s for his tax return. One of the questionnaire sheets I sent out to clients has a question that asks to report, "NON-TAXED INCOME RECEIVED FROM ANY OTHER SOURCE: (such as tip income, part-time jobs, etc)". This father always puts a dash in that section. One year I had him install carpet in my house. I paid him $800 for his and his son's labor. Guess what. Tax time came. He put a dash in the usual place. So, during the interview process, I said something like, "are you sure you have no moonlight income? I mean other than the $800 I paid you?" He turned red in the face and said "I have to report that?" I said "well, yeah!!" So we put it on a C along with some auto expense and joining tape. So, now every year he turns red during the interview process. Yes, I still do his return. But at least this year he said he's not deducting mileage because he had no 2nd job sites to go to this past year. It's been a slow year in the housing arena. So, just hang on to the client for now and see how the years progress. Good Luck!!

[myerstaxes]

To Black Bart

Hey Bart, I have worked all over the place within the IRS over the course of my 31 years prior to retirement (which is why I decided not to open an office, but stay in the peacefullness of my home office, and cherry pick clients...LOL)...Anyway, last job was Territory Manager for Small Business Self Employed, prior positions did include being a Revenue Agent, and Revenue Agent Manager, and a Regional analyst in charge of monitoring many IRS program areas...What do you want to know? I got a million stories!

[Black Bart]

Gosh...I don't know...

Hey Bart, I have worked all over the place within the IRS over the course of my 31 years prior to retirement (which is why I decided not to open an office, but stay in the peacefullness of my home office, and cherry pick clients...LOL)...Anyway, last job was Territory Manager for Small Business Self Employed, prior positions did include being a Revenue Agent, and Revenue Agent Manager, and a Regional analyst in charge of monitoring many IRS program areas...What do you want to know? I got a million stories!

there's so much to pick from (I got a million questions)...that I don't know where to start. Umm, maybe this: When returns go into the service center, do any of the the employees sorting them out have any say in which ones get audited? Can they red flag any they think need to be carefully looked at by higher-ups? Or...do they just process them and send them on without comment to a special department that selects audit-worthy returns (if so, what's the name of this department?) To be continued -- I don't wanna overwhelm your computer.

I see you're a new poster, so welcome to the board. I think you'll like it here as much as we do -- this is a nice bunch of posters and the moderators are fine folks too. After a while you kind of get to feeling like the people here are personal friends albeit they may be a thousand miles away.

So anyway, come in and hang out with us; we'll be glad to hear from you. Just start with story #1 and go from there -- I'm all ears.

P.S. Gosh again -- an IRS man with information about the inner sanctum -- I feel like a kid in a candy store.