I Hate Cheap Clients

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#1
jtaxf  
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Returning client with a new Schedule C in 2022 in addition to multiple W-2s, Schedule A, Schedule B, Schedule D, and Schedule E. Complained at my overly discounted prep fee of $350. Told him the national average fee for his type of return would be $750 and said that still didn't justify my fee of $350.

He said he enjoyed my services but that my fee was 'discouraging'.

The worst types of clients are the cheap ones.

Rant over.
 

#2
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I would have given the documents back to the client and wished them luck with their new tax professional.
 

#3
Gr8ful  
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I commonly find (especially this year for some reason) all my clients that complain about fees are the ones I’ve been giving discounts to. Then when I explain that they had a land sale transaction profiting $150,000 and my added fee is $200 this year… they call me and complain. I then proceed to add that client to my fire list for a good bye letter in the fall.

On the flip side I just had another one of clients asking why their fee went down this year and they proceed to send me payment well above my invoice. I guess it’s all about one word…RESPECT.
 

#4
Beagle  
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missingdonut wrote:I would have given the documents back to the client and wished them luck with their new tax professional.


This is the best route. If they tick you off now, it'll be worse next spring.
 

#5
CathysTaxes  
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missingdonut wrote:I would have given the documents back to the client and wished them luck with their new tax professional.

What Donut said. A cheap client better not waste my time complaining about my fees.
Cathy
CathysTaxes
 

#6
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This is why I do not discount and all fees go up every single year, no questions or debate. My annual increase is well above inflation unless the return is associated with a contractual fee involving other work, and then I am making so much off the other work that it hardly matters.

For anyone complaining about a $350 tax prep fee, I would sarcastically refer them to retail chains. I do it based on my minimum fees--"you are a better fit for H&R Block, Liberty Tax..."
 

#7
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CornerstoneCPA wrote:For anyone complaining about a $350 tax prep fee, I would sarcastically refer them to retail chains. I do it based on my minimum fees--"you are a better fit for H&R Block, Liberty Tax..."


They would charge more than OP charges.
 

#8
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OP, give him notice in the off-season and fill his spot with somebody who will pay market and not make passive aggressive and semi-condescending comments about your fees.
 

#9
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ManVsTax wrote:OP, give him notice in the off-season and fill his spot with somebody who will pay market and not make passive aggressive and semi-condescending comments about your fees.


+1 This is what I do here.

I finish/file the tax return, but I fire the client in May or June (I don't wait too long so I don't get looped into more work from the client and it is good business to let them know well in advance).

I use a very generic disengagement notice.

I have 4 or 5 on my list for this May from this year for various reasons.

(Edited for typos)
Last edited by ItDepends on 4-Apr-2023 11:38pm, edited 2 times in total.
 

#10
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ItDepends wrote:
ManVsTax wrote:OP, give him notice in the off-season and fill his spot with somebody who will pay market and not make passive aggressive and semi-condescending comments about your fees.


+1 This is what I do here.

I finish/file the tax return, but I fire the client in May or June (I don't wait too long so I don't get looped into more work from the client and it is good business to let them know well in advance).

I use a very generic disengagement notice.

I have 4 or 5 on my list of this May form this year for various reasons.


I always kept a disengage list. I wrote their name and what they did and how i felt. So i wouldnt change my mind.
 

#11
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I do something similar. It's too easy to get to the end of the year and let bygones be bygones once the situation has cooled.
 

#12
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Haha, these last few posts are funny to me because for too many years I too "did not hold a grudge" and then regretted it the next tax season.

After that, I would not only put a note "why" but I would give my future self a "pep-talk" note like:

"ItDepends, fire this person no matter what, you were all stressed out during tax season - don't be a softie".

I don't have to do that anymore because now I know better, but I did have to learn this the hard way several times.
 

#13
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So i like to give my clients an analogy. I ask them if they remember the I Love Lucy episode of the conveyor belt of chocolate.

I then tell them i am moving a LOT of chocolate and they can’t stop the conveyor belt. I must remove all obstacles to the conveyor belt. The others on the belt pay X, or the other provide X. You must behave like the others or the belt stops. That I cant allow.

They seem to under stand that.
 

#14
CP Hay  
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LOL I remember that episode. Lucy ran out of places to put all that chocolate!
 

#15
TAXTAX  
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What if a potential client asked if you can help them because H&R Block charged them too much? I have to give them an answer by Friday. What do you say to them?

I think we SHOULD charge more.
 

#16
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Taxtax, at this time of year I’d say I am full up but we can do a quick extension. Then get them in during the summer and explain what it is going to cost and why.
 

#17
CathysTaxes  
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TAXTAX wrote:What if a potential client asked if you can help them because H&R Block charged them too much? I have to give them an answer by Friday. What do you say to them?

I think we SHOULD charge more.

At HRB, their return would not be prepared by a CPA. You're a CPA and should definitely charge more. Tell them if they think you're a discount preparer, then they are in for a shock.
Cathy
CathysTaxes
 

#18
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TAXTAX wrote:What if a potential client asked if you can help them because H&R Block charged them too much? I have to give them an answer by Friday. What do you say to them?

I think we SHOULD charge more.


"Unfortunately my fee is unlikely to be less than H&R Block. Further, if cost is the primary motivating factor for you, I'm unlikely to be a good fit for your needs. Thank you for your interest and best of luck in your continued search."
 

#19
Preppie  
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I raised my fees significantly last year (2021) and only one client griped and left because my fee was too high for 'just filling in some forms'. I still have a 2848 on file for him, so I received a copy of the AUR notice last week for his 2021 return.

I tried not to smile too much. :twisted:
 

#20
novacpa  
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jtaxf wrote:Returning client with a new Schedule C in 2022 in addition to multiple W-2s, Schedule A, Schedule B, Schedule D, and Schedule E. Complained at my overly discounted prep fee of $350. Told him the national average fee for his type of return would be $750 and said that still didn't justify my fee of $350.

He said he enjoyed my services but that my fee was 'discouraging'.

The worst types of clients are the cheap ones.

Rant over.


Hahahaha...in the DC area, return is no less than 2-grand. Paid in advance. Just got a call
from an HRB beleaguered client, charged $1,450 for less work by a guy who English is
his 3rd language (not a CPA or close) - they
bxtched that they couldn't understand him. Want a chuckle, read Yelp
reviews of HRB offices, the level of anger is amazing.
 

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