Thursday, December 14, 2006


In my Tuesday, December 12th posting I told you that if you receive correspondence from the IRS or a state tax agency regarding a tax return you should send it to your tax professional immediately.

If you call or email your preparer don’t begin with the accusation, “You made a mistake on my tax return!” Nothing burns my toast more than a client who says or writes this to me when he receives a notice or does not understand something on the return. It automatically puts me in a bad mood and I must bite my tongue from replying, “Well f—k you, too!”

As I said on Tuesday, more than 50% of federal and state tax notices are incorrect. If a notice is correct and there was an omission on a return it may be because a client did not receive a Form 1099 for an item of income (just because you did not receive a 1099 does not mean that one was not issued or that the item is not taxable), or misplaced it, or simply forgot to give it to me, or his preparer, with his tax “stuff”.

On occasion a client will, as I instruct, review the finished returns before mailing and call me with the accusation because there is simply something he does not understand.

One client told me I made a mistake because he had added up the individual items deducted on Schedule A and the total I entered on the bottom of the page, and deducted on Page 2 of the 1040, was wrong. After counting to ten I calmly explained that because his Adjusted Gross Income (AGI) exceeded a certain amount I had to reduce his itemized deductions by 3% of the excess – one of the “read my lips” taxes. When this occurs I always include the calculation worksheet somewhere within the taxpayer’s copy of the return, which in this case he skipped over.

I am not perfect. I am only human, as is your tax preparer. It is possible that I could make a math or other error when preparing your return, as could your preparer. I do 400+ tax returns during a year, 95% within a 2½ month period, and I am bound to make one or two mistakes. But don’t automatically assume that I, or your preparer, is at fault when “Uncle Sam” asks for more money!

I also take exception with the IRS and state tax agencies for stating in their notices “there is an error on your return.” The form letter should read “we think there may be an error on your return” or “based on our matching program there seems to be a discrepancy on your return” or something to that affect.

So if you must call or email your preparer when you receive a notice about your tax return (I instruct my clients to “mail it to me immediately – please do not call or email first”) just say, “I received a notice in the mail from the IRS (or New Jersey or New York) and I have put it in the mail to you” or “and I want to bring it in to your office for you to review.” And if you do not understand an entry on your tax return simply say so.

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