ManVsTax wrote:ItDepends wrote:I have a "new client engagement/expectation letter" that I make them read and sign. The difference between mine and others, I think, is that there an is emphasis on expectations.
Would you be willing to share some of the points that the letter touches upon in your free time?
This board has been so helpful to me...have at it....
Dear Client:Thank you for engaging with us to prepare your income taxes this year. We are very grateful to have you as a client and we will do our best to serve you well!
Every year, a very small amount of our clients become upset with us as a result of conflicting expectations. This agreement is designed to disclose these expectations in advance to prevent any issues between us down the road and we ask that you read it thoroughly.
We must have all information and data within 6 weeks of any deadline to file on time for you.In this time window, we process data on a first come first serve basis. It’s not that we don’t want to help everyone file on time, but unfortunately, we become so saturated with work during these times, that our turnaround time becomes extremely slow. This is even for the simplest items and additions/corrections.
We are clearly warning you now that if we are corresponding or operating with you in this time window that it is almost certain that your tax return will not be filed by the deadline.
We will file an extension for you on request, but there still could be late penalties if you have a balance and do not pay it all by the deadline – which we may not have time to calculate for you.
The tax preparer will not cover or be responsible for late penalties or late filing under any circumstance. We also are not responsible to remind clients of deadlines or to take initiative to file and extension if it is not requested by the client. If an extension is filed, the Tax Preparer suggests that the client files the tax returns as soon as possible as penalties and interest for tax balances might accumulate monthly.
The Tax Preparer may charge by the form, for bookkeeping services, and/or by the hour.Our estimated quoted rates are by the form, but there may be additional fees for the following items:
• Undisclosed tax situations
• Bookkeeping services
• Redoing, recalculating, and redelivering tax returns that have already been completed
• Managing client data that comes in piece meal rather than in a simple organizer
• Spending extra time on the phone or in person with clients
Generally, we try to warn clients in advance if the situation will warrant extra fees. We are not trying to gouge our clients or milk them for money. Our operating expenses are about $200 per hour and if we are spending our time working and not getting paid for it – we are losing money – and that’s not a business model that would work for anyone. If a client expects us to work for a loss, there will be a conflict, and we kindly ask that bargain hunters and those that expect us to work for a loss seek out another firm.
Our tax preparation services do not include bookkeeping services.The tax preparer will not extract, interpret, sum, or merge data from receipts, ledgers, bank statements, emails, or other documents that are not official tax forms. The client must instead provide completed financial statements or completed organizers/questionnaires as provided by the tax preparer.
If data needs to be included, a new and updated organizer must be provided. [we provide simple, custom organizers]
The tax preparer will depend on the client to provide the information the tax preparer needs to prepare complete and accurate returns. The tax preparer may ask to clarify some items but will not audit or otherwise verify the data submitted by the client.
Ethics.We must report your activity exactly according to the facts and the tax laws. Please proceed with this expectation.
The tax preparer will not compromise ethics or accuracy for an on-time filing.
Sometimes, rather than comply with IRS requirements, clients will ask us to “use last year’s numbers”, or “just use this estimate an amount”. This happens especially when a deadline is approaching, and clients feel the stress of having an incomplete tax return with not enough time to finish it. For obvious reasons, we will not be pushed into reducing accuracy/ethics and we will not break the rules to help you file on time. In this case, the client should request an extension and if the client owes a 5% penalty on taxes due for filing a month late – then that’s just how it goes. We will not cover these penalties.
Meeting Times.When we have a client's taxes nearly completed, which typically takes around 3-6 weeks, we call the client in to review them prior to finalizing, and we provide a half-hour of time to review the return.
If you need more time than this, we will extend this to one hour. If you need more than that, however, we will need to schedule a meeting in May. One off season meeting will be gratuitous. After that, we charge a fee for our time and work.
Fees for additional calculations.We charge additionally for additions/calculations, such as your request to prepare more than one version of your tax return. Our clients are not just numbers to us and we are not overly concerned with making money. But working for free - which is at a loss after expenses, is not a business model that would work for anyone.
The tax preparer does not retain or store copies of the client's records.The tax preparer will return the client's original records at the end of this engagement. It is suggested that the Client store these records, along with all supporting documents, canceled checks, etc., in a secure location in case these items are needed later to prove accuracy and completeness of a return.
This engagement does not include additional services, other year tax filings, or future tax filings. Future prices are not guaranteed.This engagement to prepare this tax return will conclude with the delivery of the completed return to the client (if paper-filing) or the client's signature and our subsequent submittal of your tax return (if e-filing). For Clients wishing to engage with the Tax Preparer for future tax preparation, if all data for future services is not provided to the Tax Preparer within 3 weeks to any deadline, the Tax Preparer will be too saturated with other work to file on time for the Client. Regardless of time of the year, however, the Tax Preparer may be too busy or underqualified to provide future tax preparation services for the Client and the Tax Preparer will only engage for future services with a Client on a case by case basis. Prices may be subject to change from year to year.
The Tax Preparer does not guarantee the Client’s refund or that the Client’s bank will accept the Client’s refund.The IRS/State(s) may deny or hold or keep client tax refunds for several reasons. We do not guarantee the amount of any refund or the time it takes to receive any refund. Some banks may not accept a direct deposit of a joint tax refund into an individual account. If your filing status is married filing jointly, please check with your bank or financial institution before requesting the deposit of a joint refund into an individual account. Some banks may limit the size of direct deposits and may not accept the IRS transfer. If this happens, the Client's refund may be significantly delayed.
Income tax filing does not include Hawaii General Excise Tax filings (or other state sales tax filings).Income/sales from a business, rental property, independent contracting, and many other sources of income may be subject to Hawaii General Excise Taxes (or other state sales taxes). These taxes and tax returns are not included with your income tax returns and they are the responsibility of the Client. We will not file Hawaii GE Tax Returns for you unless you specifically hire us to do so separately from your income tax preparation services.
The Tax Preparer cannot guarantee the Client’s claims for credits and deductions.Certain positions and deductions may be examined and reversed by the IRS. The Tax Preparer does not guarantee positions, deductions, or tax credits. Any additional taxes, penalties, interest, or amendments incurred or as a result from disallowances, adjustments, or misunderstandings between the Client and the Tax Preparer are the responsibility of the Client.
Penalties and fees are the responsibility of the Client.All filing requirements, penalties, interest, and other fees imposed on a client are the responsibility of the Client.
It is the responsibility of the Client to disclose and report all worldwide income.The Client must disclose all worldwide income to the Tax Preparer.
Some elections and credits may expire.Certain elections and credits may expire after various time periods. Any losses incurred because of late election or credit filings will be the responsibility of the Client. Some tax returns can’t be e-filed and must be sent via regular mail. We do not guarantee on-time or successful arrival of mailed documents. Clients who wish to send mail via express or certified services must do so themselves. The Client should verify the arrival of such documents with the appropriate tax agencies.
The Client must check to see that everything was included on their tax return(s).Additional taxes, penalties, and interest resulting from documents, including but not limited to, forms W2 and forms 1099 that are mistakenly omitted form a tax return are the responsibility of the Client and not the preparer. Before filing, the Client must review the tax return to ensure that all documents have been inputted.
The Tax Preparer does not provide letters for lenders.We are not able to participate in preparing or signing letters to lenders. We prepare tax returns based upon information provided by the client. We cannot attest to accuracy of information that we have not verified.
The Client must provide the correct entity and tax return type.If we were not hired to specifically to plan and form your tax entities, we cannot guarantee that we are filing the required forms for your tax situation. The IRS imposes penalties for incorrect form filing – for example - filing a Schedule C when a partnership or corporate tax return was required. The tax preparer will attempt to guide the Client on the correct needed forms based on information given to us form the Client, but the Tax Preparer will not be responsible for penalties resulting from incorrect filings.
It is up to the Client to withhold or pay in enough tax during the year.The tax code imposes penalties when taxpayers underestimate their tax liability. These are the responsibility of the Client.
The Client may owe taxes to other states.Some US States are “difficult” when it comes to non-residency and they sometimes seek taxes from US Citizens living abroad or in other states. We are not specifically trained to know the rules of all 50 states. It is the Client’s responsibility to file and pay state taxes appropriately. There may be penalties, interest, and back taxes due for non-compliance. The Tax Preparer will make a reasonable attempt to interpret state laws and help the Client file accurately, but any penalties, interest, or other fees imposed by state tax authorities will be the responsibility of the Client.
Tax filing laws for those with non-US interests are complex – the Client might need a tax lawyer.The IRS and the Financial Crimes Enforcement Network have various and numerous reporting requirements for foreign (non-US) accounts, trusts, business, business or other entities, gifts, distributions, crypto-currency, and many other items. It is almost impossible for us to ask enough questions to cover all of them. It is solely the Client’s responsibility to discuss and to meet these requirements. Please research these needs carefully as the penalties for non-compliance could be quite large. The Tax Preparer will not be responsible for any such penalties. If the Client has foreign interests of any kind, we suggest legal counsel.
Unless the Tax Preparer clearly made a mistake, there are additional fees for most types of support. Audit representation is not included.Support with amended tax returns, letters from the IRS or state tax agencies, non-income tax related items, power of attorney, representation, penalty abatement, estimated tax planning, outstanding tax balances, payment installment agreements, additional tax forms such as form 433 or form 1095A are not included with income tax preparation services.
The Tax Preparer does not audit the Client’s work.The Tax Preparer will perform services only as needed to prepare your tax returns or otherwise agreed upon by written agreement. All work will not include procedures to find defalcations or other irregularities. Accordingly, our engagement should not be relied upon to disclose errors, fraud, or other illegal acts, though it may be necessary for you to clarify some of the information you submit. The Tax Preparer will inform the Client of any material errors, fraud, or other illegal acts we discover and advise accordingly.
Electronic delivery may result in reduced accuracy.The Client assumes all risks of misunderstandings and miscommunications resulting from electronic services and delivery of services. While we are willing to offer services without the Client being present, we suggest that Client seek out a local tax professional for services in person for more accurate preparation services.
Payment is due prior to filing.Invoices are due and payable upon presentation. Interest or collection actions may be imposed for payments beyond 30 days.
Tax planning, tax mitigation, and entity formation advice, given by us, may not ultimately be the Client’s best option(s).Accurate tax planning depends on several factors. We do not guarantee that the options we present are the best for your tax, liability, legal, and financial needs. The Client agrees that the Tax Preparer is not responsible for losses that may be caused by the results of the advice provided. The Tax Preparer officially recommends that the Client hires a business lawyer, financial planner, or insurance broker, etc., to help with these needs.