Request for a comfort letter for employment

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#1
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I have a client who is the tantamount PIA, doesn't bring things in, promises to drop by with stuff, doesn't show up, has told the SUTA office that I prepared payroll for this year so they should call me about missing documents, the list goes on. He hasn't brought in tax material for 2017, I still need about three months to finish his corporate bookkeeping to do a corporate return. So you guessed it, I want to cut him lose.

Then this morning I had an e-mail telling me he has been offered a job at a local airline but needs income and employment history/verification from 2011 forward, and would I please provide data. It includes this phrase: "I hope you have a good idea of how we can do this so I don’t lose out on the opportunity". I can provide two W-2's, he hasn't paid himself at all, to my knowledge in 2018. In addition to being a PIA, he has a history of domestic violence, he beat up his daughter (in his words "I disciplined my daughter"), so badly that his wife grabbed their other two kids and the daughter and fled the home. The daughter now lives with grandparents in Idaho because she is so afraid of her dad and the wife would also leave, but can't because the court won't allow her to remove the kids from the state, it might make dad feel badly doncha know.

Part of me is on a rant here because of the e-mail and veiled threat that I might cause him to lose an opportunity. More than that though, I want to cut him lose and not prepare anymore work for him at all including the outstanding 2017 returns. I don't think that's a problem, but it is late and I'm concerned about something coming back at me. My office is now in my home and my husband is here all the time, so safety isn't an issue, but I don't want to end up defending myself against something stupid. Any suggestions for the letter to fire him?
 

#2
makbo  
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If it were me, I would write a straight forward dis-engagement, referencing my TY2017 engagement agreement signed by the client, where it states "I reserve the right to withdraw from this engagement without preparing your income tax returns in the event you fail to comply with the terms of this engagement letter". No, it's not a statement written by an attorney, but at least it gives me something neutral to use to explain the dis-engagement.

There is no point at all in trying to provide any other reason/justification for dis-engagement.

The "income and employment" verification can come from the IRS transcripts, which the taxpayer can obtain via online self-service. As another recent thread discussed, even if you wanted to keep the client, it's not your job to provide a comfort letter to a potential employer.

The templates I have found online also state that it is important to be as explicit as possible as to what you've already done, what the taxpayer still needs to do, what original documents have been returned, etc. I recommend sending U.S. mail with some kind of tracking.
 

#3
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I don't have an engagement letter yet for the tax returns. He's never come in to provide documents or complete the bookkeeping, much less start a tax return. I prepared them in 2016, and he's assuming I'm going to do so now. He does have a list of things needed for the return, when he brought that in, he would have signed an engagement letter. Haven't seen him since about August.
 

#4
makbo  
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actionbsns wrote:I don't have an engagement letter yet for the tax returns. He's never come in to provide documents or complete the bookkeeping, much less start a tax return. I prepared them in 2016, and he's assuming I'm going to do so now.

That is a small problem, I guess.

I have my clients e-sign (costs only $1, very easy, no questions to answer) my engagement every year, for one year's worth of tax work at a time, in January/February. If they haven't signed by end of February, they are pretty much not going to hear from me again, as we will have no engagement and no service will be provided by me.
 

#5
novacpa  
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Ask him for $5,000 advance payment - so you can give him exclusive representation.
 

#6
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Some clients aren't worth the effort at any cost. He falls into that category. There was an e-mail this morning demanding my employment verification letter ASAP so he can e-mail it by 8:00 Monday morning. I had already declined to provide the letter, but did provide copies of the two W-2's I have. So I re-iterated my lack of records and more clearly stated I would not be providing an employment verification letter. Dis-engagement letter to follow.
 


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