1 vote

Personal Problem: The IRS,... and My Tax Accountant

I have been in business for myself for a year now. My company sales for 2010 were just shy of 92 grand. I started this single proprietor LLC as a result of losing my job when the company I worked for was shut down by the bank. They took everything and were planning to take my bosses family home... he killed himself a week after he lost his company... but that is another story for another time.
I already had an established list of wealthy clients through my many years of working at my former employer, and they all encouraged me to just keep working for them under the banner of my own company. I am in the home maintenance and repair industry. I am non-union, having had numerous run ins with unions in the past where I vehemently disagreed with their overt politics and policies.

To make a long story short (hardly possible) I went to the lady who has done our taxes for the last two years, taking my box of documentation with me -- receipts, bank statements, rental agreements, canceled checks and the all important profit and loss summary from my accounting software. She has always been helpful in the past.... when I wasn't self employed. While sitting in the waiting area, I began to notice political posters in numerous locations in her family business. They were about a current hotly debated issue now going on in my home state of Missouri... Right to Work legislation. And she is obvious an opponent of Right to Work. "Right to Work is a Rip-Off" was in several locations in her offices. There were posters that read "Why Right to Work is a Lie" with a list under the heading.

My first thought was "I hope she will deal with us fairly." And my second thought was, "Surly she will... she is a professional and won't allow my non-union status to interfere with her duties as our tax accountant".

As soon as we sat down she asked where we had our taxes done last year. I said "Here, of course". She was looking at a file in front of her, "No you didn't... where was it?"

Then she asked for my Profit and Loss summary, looked at it for about 3 seconds and said, "This is a joke, right?" I was taken back. Then she said "you are going to be audited by the IRS, you do know that don't you?" I asked her why and she said, "Because your accounting software is too user friendly." I informed her that I either had or could easily get documentation to establish every line involved in my P&L. Then she proceeded to grill me about each line:

"What is this Rental of other business property?" A storage shed for my tools. "Where is it... in your back yard?" No, on highway 94, it's called such and such and the rental is $151 a month.
"What is this car and truck expenses?" Truck lease. "You can't do that."
"What is this Owner Draw account?" My pay I have taken out of the company to feed, house and cloth the four members of my family. "You do realize you will be paying self employment tax on every dollar of that?"
"What is this Employee Benefits?" That's our health insurance premiums, nearly $1800 a month!

She continued in this manner. The final straw is when she asked me a question about a line on Contracted Labor, my answer made her say, "You really have no right to be in business."

I grabbed the paper out her hand and the wife and began to collect the rest of our stuff and our 3 year old. The accountant stood up and began to walk away. I told her she had no business treating me like a criminal, to which she responded, "You have no business coming to me to do your taxes." and walked away.

Now this woman has our personal information in her system... SS#, income stats for the previous years, etc. Should I be concerned, or was this just her personal political taste acting rudely? Any thoughts about what I can do?



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Again... I'll raise the issue

Are there no Libertarian/liberty oriented business listing sites? This is a glaring error on the part of this movement if true. Liberty-minded folks want to support liberty-minded businesses, IMO. Where is the "Yelp.com" for Liberty?

Good idea. God knows I would

Good idea. God knows I would consult it... and be listed in it. The only problem is how to confirm they are pro-Liberty and not just trying to get one more networking oppurtunity.

Just find another accountant

My accountant loves Ron Paul, hates the Federal Reserve, and despite charging me 250 every year to do our taxes, took 100 dollars off this year, because we earned so much less. Nice. We, too, are self employed, although not very much employed.

wolfe's picture

You're fine... :)

Take it from someone who has had more than his fair share of interaction with the IRS... No worries, just find a new accountant that you like.

Good luck.

The Philosophy Of Liberty -
http://www.thephilosophyofliberty.com/

The best thing about the

The best thing about the accounting industry, especially the tax portion is that it is competitive. Find yourself a new CPA.

"The economy's not a class you can master in college. To think otherwise is the pretense of knowledge."

sucks you are in missouri

my tax account in Minnesota rocks...been indited like 28 times but beat the raps in court every time...you know he is good when the IRS HATES HIM.
I think they quite harassing him or maybe he quite testing the waters, but either way he knows his stuff.

put it in writing

I would send a certified letter with signature requesting she hand over all files and information, and that no information be left with her firm (including in her computers). That you will pay her a reasonable fee, perhaps one hour of clerk time, to get all documents together. You will pick up the docs.
And that she is no longer your accountant and may not represent you with the IRS.

In the end, she can run her business as she desires. And you are free to move on.

Don't we have liberty-friendly referrals?

If not, this is a clear business opportunity!

If she prepared your taxes in prior years there is little

she can do to you based on those filings, because it would make her look bad if they are in error. It would be like she was telling on herself to the taxing authorities. Given that, not sure what you could accomplish by escalating your experience to the state, which, she seems to support 110% (unions, etc.). She represents the "mob", after all.

Find a small-business friendly accountant to get your taxes filed, and maybe ask them if you should be worried based on your experience with this "professional".

=======
RON PAUL 2012

I can see why you are concerned.

The "lady" sounds like a mental case. I would just get the taxes done elsewhere, maybe ask another smart businessman (woman) in your field for a referral. And then try not worry about this lady and what she might do.

dont do business with her is

dont do business with her is the key. Doesnt sound like she was any good anyway.

As a CPA, I'm Speechless

It is scary that she denied preparing your return. It may have been helpful to have a copy of the prior year tax return, but you would assume they would already have a copy. Accounting software cannot be too user friendly. As for your Car and Truck expenses, you can deduct that unless you plan on walking to each job. File a complaint with the Better Business Bureau and find a reputable accountant. Since your prior year income was from W-2 income (I assume), the source of the information is from a third party, so that shouldn't be an issue. Concerning the current year information, as long as you have all the documents and she didn't copy them, she doesn't have the information anymore.

Thank you for your input. I

Thank you for your input. I was dumbfounded by the whole episode and a bit numb. Her statement that my accounting software was too user friendly was nonsensical. Am I supposed to buy a program that takes a CPA to figure out? What's the point in buying one then? Can you imagine the sales pitch: Finally, a do-it yourself accounting software the virtually eliminates any chance of an IRS audit due to your accounting program. If you are audited, you can rest assured that it wasn't because of using our product... our product is impossible to use!"

After supplies (a huge amount of money in my industry) and all the other expenses like health care insurance (another whopping dollar amount), all of which i kept detailed records of, my spendable income came to just at 48 grand. From that, I have to take care of my adult disabled son (Down syndrome), my wife and our three year old daughter who we adopted over a year ago. I can't see how they can expect me to have tons of money to fork over to the IRS. Yet this woman acted like an IRS audit was 100% coming. Okay, let em come. I'm about as small a potato as they will find.

Seems to me she was either

Seems to me she was either having an extremely bad day or she simply didn't want your business anymore.

Or... she was so pro union

Or... she was so pro union that not only did she not want my business (which is fine) but she wanted to make my day suck.