Minimum Records of a Client

[erchess]

Client I have done is a little concerned about her return in electronic format even though I have taken it off of laptop and keep it on a flash drive which I keep secure. So anyway I remember reading somewhere that instead of keeping an electronic copy of the return I can keep paper. Can anyone tell me what is the minimum I must keep? She filed on paper despite the fact that I charge $10 more for that service. TY in advance for any help.

[Peachie]

What about this?

Can anyone tell me what is the minimum I must keep? She filed on paper despite the fact that I charge $10 more for that service. TY in advance for any help.

Why not just keep your receipt of the forms she filed without actually printing them out until next year. This is what I do now that I have everything on the flash. I keep the receipt/invoice and maybe just the 1040, if I had a customer insist. None of mine do anymore because it's an additional $25 for this service. She has her copies, and you have everything you need on the drive even if you are not filing it electronically.

Peachie

[Zee]

-Peachie

I've never had this happen. Your suggestion to charge an extra fee for demand like this is a very good idea. I'm sure they'd change their mind quickly if it required an additional fee.

[erchess]

Apparently I was unclear

This lady would like for me to keep no paper or electronic records. I know I cannot get by with that. I would like instead to keep the minimum papers and delete the electronic record totally.

I think I read somewhere that name SSN and base form filed were sufficient.

[DaveO]

A list of return filed

And the name address and SSN is all that's required under Circ 230.

[Zee]

A list of the return filed, and the name address and SSN is all that's required under Circ 230.

Dave-

I'm not questioning your answer, but can you send me a link where it states this? I can't seem to find it.

Also, if the return is e-filed, a signed copy of the 8879 must be filed for 3 years, no? What about other signature forms?

Honestly, if a client wanted everything returned and the return deleted from my software, I wouldn't keep them...too paranoid for me. What if there's a question in two years? How can the preparer use the old CYA philosophy?

Am I missing something?

[DaveO]

Pardon me about the E-File records

You are correct Zee regarding the 8879 and W-2. Tired to pull up Circ 230 for the rest but it's temporarily unavailable. Fine time for the IRS to take a powder on us.

[ChEAr$]

necessary records

This lady would like for me to keep no paper or electronic records. I know I cannot get by with that. I would like instead to keep the minimum papers and delete the electronic record totally.

I think I read somewhere that name SSN and base form filed were sufficient.

It is indeed, erchess. No law says we have to keep a copy of the return, although I do in
electronic form available only via password.

[ChEAr$]

It's not circular 230

You are correct Zee regarding the 8879 and W-2. Tired to pull up Circ 230 for the rest but it's temporarily unavailable. Fine time for the IRS to take a powder on us.

but other IRS regulations that govern record keeping. If I were at office, I could find it .
Probably.
Maybe

[Zee]

Treasury Regulation Subchapter A, Section 1.6107-1(b)

Here's a link to the applicable section. It confirms what others have said. I don't see any mention here of the 8879, etc., but I'd sure retain it for my files. Again, it seems like an unreasonable request from a client to me.

http://www.taxalmanac.org/index.php/Treasury_Regulations%2C_Subchapter_A%2C_Sec._1.6107-1

[S T]

cya

Personally, I like to retain copies of what client's provide me to prepare their tax return. Most of my clients have not had an issue with this, and there has been many times that they have called me requesting a copy of a W-2 form or mortgage interest statement.

I also keep copies of the tax returns and the forms 8879, all probably an overkill, but I don't know how many times I have been asked for prior information.

Yes as Bees said in a prior post I guess I am too nice and play "mommie".

At least with documentation in file, I know what the client provided and know what I reported on the tax return. So if the client made an error in not providing something, the client will most assuredly know that.

Now after mid stream into converting to paperless, it really is not a "big" deal, just a little scanning time is all.

Sandy

[DTS]

Very unreasonable request!

Erchess,

Sounds like she needs some anti-psycotic medication!

Years ago, I worked in an office and was there late one night when this loon called and said he wanted all traces of his info to vanish within an hour or he was coming over and tear up the office from one to the other and the preparers included. There was no way to reason with this guy. Everyone in the office took him at his word that his threats were very real. After a call to management, the records vanished and police were posted outside the office.

Having said that, I would keep a record of this woman's return and not tell her about it. I know you are trying your best to accommodate her, but this really is an unreasonable request on her part.

Just my opinion.

Dennis

[Peachie]

Tired of being aggravated Zee

-Peachie

I've never had this happen. Your suggestion to charge an extra fee for demand like this is a very good idea. I'm sure they'd change their mind quickly if it required an additional fee.

I sent out letters letting my clients know that all returns would be electronically filed whether a refund is due or taxes owed three years ago. All of that paper was driving me nuts and exploding my file cabinets. I lost one client.

I tell them they can have all of the additional copies if they want to mail the returns but the paper fee is $25. I am trying to streamline my workload, not make it harder. I am being complimented now by many for doing this. I end up now with a receipt, w2's, 8879 and 8453 available in paper--everything else on flash. I find that when clients know additional fees are imminent, they don't need quite so much.

Peachie

[Lion]

Electronic Files

Although you could keep the minimum list the IRS requires, what about pro forma for 2008 returns? If she wants you to eliminate your electronic record of her 2007 returns, charge her a set-up fee each and every year for having to input her information into your tax software anew each year. $100 or more. Or, refuse to prepare her taxes if she's wanting you to work so far outside your usual system. Tell her it's harder to prepare a complete and accurate return without consistency within your software and office procedures, so pay for your additional time or conform to your system or hit the road. Sometimes the paranoid ones are best let go.