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Are you giving your medical clients a Corona Discount?

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#1
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I planned to charge normal rate, though I've extended all service payments for all clients (medical or not), though I've never been one to await payment prior to efile as I believe most are here.

Some of my medical clients scoffed that I charged them a fee during this time. My take is that it's part of the job, some are government union hospitals with double overtime and huge pensions, of which I don't contest. When Lehman hit in 2008, I never expected to get freebies, so I just presumed similar, of course this is different. Just seeing what my more advanced peers are doing, should I reassess my vista? Advanced thanks.
 

#2
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Some of my medical clients scoffed that I charged them a fee during this time.


Will the hospitals be charging the patients?
 

#3
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Jeff-Ohio wrote:
Some of my medical clients scoffed that I charged them a fee during this time.


Will the hospitals be charging the patients?


Good point.
 

#4
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I'm going to exercise empathy and have an open mind regarding billing for affected clients, but I will not be discounting my services for circumstances outside of my control.

Clients that expect me not to bill them when they otherwise have not experienced a decline in income or other financial hardship are being unreasonable. And yes, I've already had this happen.
 

#5
Wiles  
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Related and unrelated, I do not plan on finishing up certain negatively affected business returns (e.g. restaurants, bars) right now and hitting them with an invoice. That would be delivered at the wrong time for them... and me.
 

#6
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Hang on a minute. When you say "medical clients" do you mean people who work in the medical field? They are the ones who will be able to afford it more than anyone. They are going to be going into work after the rest of us have been closed down. They are going to get paid. My wife is a Registered Nurse and our family finances have been helped by this - extended on-call hours, etc can add 10% to take-home pay in an average pay period. Although I am not yet bringing home an income, we have found ways to manage on my wife's salary. The sacrifices have not been that hard.

Yes, you should be billing them your standard rates and they should be paying. Mind you, I offer nurses a 10% discount on fees anyway, but that has everything to do with them being undervalued by society and forgotten about when first responders, military and teachers get special deals and nothing to do with COVID-19.

Wiles, most of my clients want their returns right now. I have some clients calling every day for an update. Have you fo0und it reasonably easy to talk to clients about this?
 

#7
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Nope. My clients in the medical field do quite well, I am not going to offer any discounts. No doctor ever gives me a discount for something beyond my control (though it is typically out of their control unless it is their own practice). One doctor's business has a contract with me for accounting and tax services, anyway, so I can only charge extra if a service is out-of-scope.

But, I am currently trying to not hound them for information and only responding to THEIR inquiries/requests, since I know they are working insane hours, along with personal matters.
 

#8
ATSMAN  
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In the past I have given discounts on a case by case basis because of some difficult my client was facing. I don't agree giving a blanket discount to one profession over another profession. I know some tax preparers who focus on certain types of taxpayers (like Police or Fire fighters) will give a special discount, but that is their business model.
 

#9
novacpa  
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I ask my "Docs" if they have treated an infected patient - if they have - I avoid them.
Discounts No - all of them have had record years.
 

#10
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I have one client I am backing off on in collecting amounts due to me (they already owe me money under a mutual agreement), but his company is in the wholesale and quick-serve industry. Going to end up taking advantage of as many extended due dates as possible to delay hitting him with more fees, but since I already heavily discount in most cases for him, there is a limit. I do it because we are friends. I know he is going to be feeling an impact since bulk of his clients are in hospitality and F&B, and those are all but shut down at this point, especially for his product.
 

#11
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Yesterday I agreed to modify my billing practice for one client severely impacted by a city business shut-down in which the client's business is not considered essential.

I agreed to bill 50% upon return filing, which will happen within a week or so, and 50% on July 15th. No discount, just partial deferral.

I have already identified another client that I'll probably offer this path forward to. (client is going to be devastated over the next month or so due to foot traffic reduction)

Any one else experiencing the same?

Trying to work with clients, understand their financial position and outlook, and not be callous. At the same time, I cannot afford to defer all billings for every client indefinitely.
 

#12
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ManVsTax wrote:Trying to work with clients, understand their financial position and outlook, and not be callous. At the same time, I cannot afford to defer all billings for every client indefinitely.


In our industry, accounts receivable age like a dead fish left outside in an Alabama summer. With 1040-only clients in particular.

I have one business client whose cash flow always sucks in Q1. We've had a handshake agreement for years that they pay half upon filing and the remainder later. They appreciate my willingness to do that and it has made the relationship stronger. Would I do that for everyone? Absolutely not, but for a good client, and a good person, I'll take the risk.
 

#13
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missingdonut wrote:They appreciate my willingness to do that and it has made the relationship stronger.


That's an intangible perk that I'm gambling on.

Win-Win.
 

#14
Eduardo  
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We have two bar clients (they're related - one shareholder owns 50% of one and a majority of the other). They're shut down now due to our state shutting down, so going to let them defer paying us (we bill monthly). They always pay and are never a PITA, so going to work with them. Another is a landscaper who pays us over $15K year over several related entities and going to do the same for them as they always pay and never bitch.
 

#15
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Not giving a break to those working in health care - though that's great that they do that for the community and I appreciate it. I'd rather give to charities like "meals on wheels" etc as a way or giving back to the community.

As for my business clients, I'm not sure.

I would like to figure that out on a case by case basis. Working totally free (not even deferred billing) for a couple of months for those hardest hit and who are most endearing to me. But no breaks at all for the PITAs who have seen minor impacts.

I'm not sure if that is legal, however. Sounds discriminatory as I write it. I know that being a PITA is not a protected class, but that still doesn't mean I can't get sued for it.
 

#16
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Don't work for free, but does not mean you cannot set terms that push the due dates so far into the future that it allows the businesses to buy themselves time to recover and pay. I have one client I will be doing that with; he's going to be hit hard enough, and desperately needs a CPA involved in his affairs.

Not sure of the laws in Hawaii, but I find it hard to believe CPAs could face discriminatory action in choosing who they work with, and under what terms. We do it all the time, including by having (hopefully) defined "ideal clients." We may not publish it, but we still practice it on a routine basis.
 

#17
CathysTaxes  
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Nope, I am going with normal rate. I'm already taking a hit expanding credit card payments without a surcharge and then mailing the return because some clients can't figure out how to print out a PDF.
Cathy
CathysTaxes
 

#18
dsocpa  
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I am glad to see this disscussion here. I've been debating on how to handle billing for several of my clients. 3 in particular are small business clients that have been directly impacted by the (partial) shut down. Either their business or their customers have had to close down which of course means they close. The soft-side says cut them a break, however, I do still have to eat, pay my mortgage, etc., but most importantly I earned that money. And I totally agree we shouldn't work for free. My thought is to extend some repayment terms. When I do that I usually set up the payment to auto withdraw at intervals but in this case I'm debating. Anyway, still haven't decided how I'm going to approach this. Planning to send some invoices this weekend - will have to decide quick!

I've been reading that this might be a turning point for our profession in that clients will be coming to us for advice because they absolutely need too in order to keep their business alive. I'm still thinking how to capitalize on that but the seed of the idea has been planted.
 

#19
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Here in the Bay Area a large percentage of small retailers and service businesses will go under "if" the statewide CA shutdown continues for more than a couple of months. Low-interest loans aren't going to make the difference for many of them unless they'll be able to get out of them in bankruptcy (year, right).

There is major movement by city governments to stop evictions of residential tennants. Since local govts can't force mortgage holders to stop foreclosing, it's going to be the big fish with deep cash reserves eating the smaller landlord fish in a couple of months.

My tech clients and tech employee clients are still doing ok. But when worldwide and domestic slowdown in purchasing hits b to b, it won't be pretty.

Somehow I don't think my clients will pay their cpa bills before their suppliers and employees.
 

#20
ATSMAN  
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I hate to say it this way, but from a natural law perspective Pandemics in the history of this planet have by course of natural selection eliminated the weak and the strong survived. I can still hear my high school teacher talking about Charles Darwin and the "Survival of the Fittest" theory.

It hurts when it is someone you love and care but laws of nature trump all that emotion. Just my two cents to keep things in perspective. :( :( :(
 

#21
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I am optimistic, but I'm also a realist.

I hope for the best, however I'm aware things could get much worse, as illustrated by Len in post #19. I think it's a good idea to bill something now, whatever the client can afford, instead of deferring everything. We have to assume some of these clients might be bankrupt in 2-3 months and not be able to afford to pay anything.

Most of my clients are well capitalized. However some own only single-family residential rentals. That is their niche. If their tenants stop paying and the mortgage company keeps collecting they might be in trouble.

50% now and 50% due July 15th seems to be equitable for both the client and I if the client is truly in dire straights.

Like dsocpa, I still have mortgage payments, payments for utilities, HOA dues, interest payments on loans, insurance, and grocery and essential costs. No one is cutting me a break there. Therefore, the solution must be equitable.
 

#22
ATSMAN  
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Like dsocpa, I still have mortgage payments, payments for utilities, HOA dues, interest payments on loans, insurance, and grocery and essential costs. No one is cutting me a break there. Therefore, the solution must be equitable.


That is the response you give to an undeserving client when they demand a discount just because they feel they deserve a discount!
 

#23
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ATSMAN wrote:I hate to say it this way, but from a natural law perspective Pandemics in the history of this planet have by course of natural selection eliminated the weak and the strong survived. I can still hear my high school teacher talking about Charles Darwin and the "Survival of the Fittest" theory.

It hurts when it is someone you love and care but laws of nature trump all that emotion. Just my two cents to keep things in perspective. :( :( :(


I hate to admit it, but I am always comparing my practices to others to make sure I remain on top during tough times, or as the industry evolves, younger people enter business, etc. Adapt or die, IMO, and I am always looking to evolve. It is part of the reason I am growing so rapidly compared to most firms in my area—I am not stuck in the traditional CPA firm rut. I am also very nicely postured to absorb clients of CPAs that retire or kick the bucket, because nearly all firms here are owned or managed by CPAs in their 60s and 70s. The next five years will be VERY interesting years for our industry where I live, and across much of the country.
 

#24
dsocpa  
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During the last reccession I had a few clients who never should have been running a business. A couple potential clients I turned away because after awhile you just know who's going to make it and who isn't. There were a couple that surprised me, but I totally agree with Atsman it's survival of the fittest.
And yes ManVsTax, no one is getting a payment plan unless A.) They have a good track record of paying over the last several years, B.) I know they are trying to move forward, applying for loans, etc. C.) Must pay by will owe past 7/15 (I'm even thinking 7/1).
 

#25
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dsocpa wrote:During the last reccession I had a few clients who never should have been running a business. A couple potential clients I turned away because after awhile you just know who's going to make it and who isn't.


One thing I learned early on in my career is that some people are business owners not because they have the ability to run a business, but because they have an inability to work for someone else.
 

#26
Wiles  
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One thing I learned early on in my career is that some people are business owners not because they have the ability to run a business, but because they have an inability to work for someone else.

That is really good. If businesses had bumper stickers, this would go on ours.
 

#27
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missingdonut wrote:One thing I learned early on in my career is that some people are business owners not because they have the ability to run a business, but because they have an inability to work for someone else.


Precisely why employers do not like hiring prospects with a history of self-employment.
 


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