Medical Expenses - due diligence

[Gretel]

I just received and read the newest issue form NSTP. On the last page it talks about how important the interview is and that we need to ask our clients questions f.e. what the dentist did and why. (Teeth whitening non-deductible unless there is a medical reason). And other examples.

Right that moment I wanted to give up the profession. If we have to go into all the details on every line item we have to charge much more and who is going to pay that bill. I guess I am just venting.

[oceanlovin'ea]

We can only ask so many questions. Sometimes if a client has a very large bill, they will say they had to get dentures or had severl crowns or will offer some explanation.

I think that we all usually do ask questions and try to make sure that our clients claim their income and the deductions they are allowed.

At the forms and update seminar I went to in Tampa in January one afternoon we had people from the IRS and the state there telling us how to do some things and what the IRS is doing and looking for. One person talked about the preparer penalties and doing due diligence and had a lot of people scared. The next day the speaker said that we have been doing that all along. We don't have to change how we have been doing things because most of us have been doing due diligence with every client.

So I try not to focus on that and just focus on giving my clients the best service I can give them.

Linda F

[David1980]

. what the dentist did and why. (Teeth whitening non-deductible unless there is a medical reason). And other examples.

I think there's a balance, however for this particular question you have to ask just how big an issue that is really anyway, considering how few people actually exceed the 7.5% limitation. I mean it doesn't matter what they did if they're not getting a deduction for it anyway.

[Black Bart]

More effort to convert us to unpaid IRS agents.

...form NSTP...we need to ask our clients...what the dentist did and why...Teeth whitening non-deductible...Right that moment I wanted to give up the profession. If we have to go into...details on every line item we have to charge much more and who is going to pay that bill...just venting.

NSTP is absolutely wrong for meekly following IRS on this and you are absolutely right to vent about it -- it's enough to make anybody want to give up.

As oceanlovin'ea mentioned, they are scaring preparers with that due diligence club. IRS has virtually eliminated many large deductions by making us choose (via preparer penalties) between clients' welfare and our own, but that isn't enough -- now they want the small stuff. This trivia isn't audit-worthy (they can't afford to waste agents' time on such), so they want us to do a sort of pre-audit (like a dentist's "preventive maintenance" screening). In this way, as we rake over the crumbs with our fine-tooth combs, we become unpaid auditors of unaudited returns -- a remarkable accomplishment if you think about it.

David said few people get the deduction anyway due to the 7.5% limit and he's right. But this issue could be compared to the price of gas -- if you could ask Exxon "How much is enough?" their answer would probably be "There's no limit!" It's the same with IRS -- they want it all and -- public relations propaganda aside -- they don't care how much time and money that we and our clients are out to help them get it.

This is just a ridiculous issue. I'll advise my clients that cosmetic procedures are non-deductible and they can say yea or nay, but I'm not wading through hundreds of tediously detailed medical bills to scrape up extra nickels for IRS.