Holy Crap..Just got a letter from the IRS!!! UPDATED PG.3

[barkley]

this is why i too use a cpa! in fact i was thrilled to learn that if we move out of state mid year my current cpa can do both state's tax returns for the overlapping year!

 

[Nancy]

Why would they not believe you? It's right there in black and white!

They signed off as the paid preparers right?

They made the mistake in addition right? They made the mistake in not entering figures right?


From what I can see from what you wrote you have them cut and dried...they screwed up, they need to fix it and make it right...and if there are penalties, they need to cover them.


My BIL does our taxes, he's a CPA and works for a tax preparer. Love the fact that I just hand everything off to him and sit back a relax.

 

[FreshTressa]

How terrible...I can't even imagine!! Let us know how it turns out.

BTW-your kids are gorgeous!

 

[Eeyore'sthebest]

Since you purchased the piece of mind protection they are supposed to be responsible for penalties, errors and I thought the extra taxes. Maybe I'm wrong. Good Luck and keep us posted. If they don't stand by it I'll stop wasting my money.

OT: How does one find a reputable CPA? I had a co-worker that ended up owing over $20,000 due to fines, penalties, etc for years of bad advice. I'd hate to just look in the yellow pages.

 

[chris1gill]

I'd be thoroughly sick too Good luck today, I hope they make good on their mistake How awful....

 

[mickeyfan2]

In Wisconsin (and I assume this might be true other states too), the cost of hiring a CPA is also tax deductible because it is considered a business expense. DW is self employed and we have a CPA do our taxes because every year we get to see that little credit show up. No cost to us at all!

Yes the cost of a CPA is tax deductible. The IRS allows this deduction. We us a CPA every year and I do read the return when we get it back. I have caught a mistake or two over the years. I will call the CPA and ask specific questions and only when I feel I understand the return do we sign it and send it in.

 

[Disney1fan2002]

Add us to the "never go to H&R Block" crowd.

We went there once and never again.

I hope they fix this for you.

 

[eyeoreismyhero]

The problem with H & R blocks is you take a 4 hour tax class and they put you to work preparing returns. Anyone off the street can take a class one night and do your return the next day . I went thru 4 years of college and 6 tax classes and still had problems on some more complicated returns when I went into public accounting right out of college. Unless you have absolute bare minimum returns stay away from them.

 

[lemondog]

DH went to H&R Block when he lived in Georgia and they just completely forgot to do his state income taxes! Because he was from TN and so used to living here, where we don't have state income tax, he didn't realize H&R Block's mistake until he got a letter from the state of GA.

Needless to say, we use a CPA now. And yes, our fees are tax-deductible.

 

[CathrynRose]

The problem with H & R blocks is you take a 4 hour tax class and they put you to work preparing returns. Anyone off the street can take a class one night and do your return the next day . .

This isnt true. My mom was a manager for H&R Block for years. It's a loooong class, you have to take every year (if you want to work for them, every year), for almost 3 months - twice a week, before the tax season starts. THEN you have to pass all their tests - and they have plenty.

My mom, who was a whiz with taxes stated many-o-times - many people would drop out, or fail miserably - and that it was a real P.I.A.

 

[Bob Slydell]

This isnt true. My mom was a manager for H&R Block for years. It's a loooong class, you have to take every year (if you want to work for them, every year), for almost 3 months - twice a week, before the tax season starts. THEN you have to pass all their tests - and they have plenty.

My mom, who was a whiz with taxes stated many-o-times - many people would drop out, or fail miserably - and that it was a real P.I.A.

You beat me to it. H&R Block does require a lot more than a "4 hour course" in order to worl for them. A friend of ours (a licensed CPA) just went through their courses and it was a couple months of classes. Even so, people make mistakes -- even CPA's.

 

[mickeyboat]

To the OP - good luck getting this straightened out! I would be petrified, too.

As to H & R Block: one of our employees was so impressed with them because he was getting a big refund. Come to find out H & R Block deducted his medical insurance premiums, even though they were already taken out of his income on a pre-tax basis. And I doubt his medical expenses met the threshhold, so he wasn't entitled to the deduction. I hope the guy bought the protection policy!

Denae

 

[puffkin]

Wow that stinks! Hope things can be fixed without too much hassle.

I am a CPA and let me tell you, you would NOT want me to do your taxes. Just a word of warning, but CPA's are like any other licensed profession with specialties. Make sure you find one that specializes in taxes because many CPA's do not have extensive knowledge of tax law.

Another word of warning is that even though you pay someone to prepare your taxes (and rightfully expect them to be done right) YOU as the taxpayer are ultimately responsible for the information on the return. It is your responsibility to read through the return and make sure everything is there and to ask questions if you think something is missing or not right. A good tax professional would walk you through they return and help you and explain things to you.

I don't know how H&R block works, but the CPA firm I used to work for would prepare an ammended return for free if they made a mistake. They would also pay the interest and penalties. However, any taxes owed would still be the responsibility of the taxpayer.

I know this is a hard lesson to learn....hopefully things work out favorable for you. Take some time before next tax season and find a good tax specialist. You may even benefit by having some tax planning done since it looks like you have a rather complicated return. A good tax professional can be worth their weight in gold, but there are a lot of incompetent preparers (CPA and otherwise) out there, so be careful.

 

[ZachnElli]

I hope you are getting this worked out! Add me to the never again with H&R Block crowd! They messed up our taxes 2 years in a row! This was back when our taxes were easy, no kids, no house, just us and our jobs. But 2 years in a row we got that dreaded IRS letter. Thank goodness both of ours were like $800, so nowhere near your $7000! Good luck!

 

[mainewmn]

I use to got o H&R every year, then one year I just couldn’t find good time to go to them and went to Jackson Hewitt. They messed up my taxes so badly that IRS themselves corrected them and send me additional $ I deserved. That was that for me now I use TurboTax and have a CPA look them over before I submit them. If you paid the extra $ for their protection plan then you should be OK, Good luck!

 

[Tina]

I agree with Puffkin on many points. I am an accountant and used to work in a public accounting office.

While H&R Block may cover the penalty and interest, you, as the taxpayer, are still responsible for the taxes due.

Also, don't assume any CPA will do your taxes correctly. If taxes are what you want done, you should get an EA - Enrolled Agent. Taxes are a specialty for EA's and the EA certification is not an easy one to acquire. Of course, there are CPA's out there that specialize in personal tax issues, but when you get an EA, you KNOW they know taxes. The public accounting firm I worked in was all EA's - no CPAs. You wouldn't believe some of the messes that we encountered when people would come to us after using a CPA that wasn't knowledgeable in taxes. Also, EA's have a special designation that allows them to represent you before IRS. Good luck to you.

 

[mickeysgal]

I really don't want to pile on, but there is a reason CPA's have a degree and certification testing and "tax-preparers" have a week of night school.

Well, being a CPA doesn't necessarily mean you're error free either. Last year, due to a move to another state, we had a HIGHLY respected #1 CPA in our town do our taxes. After holding them for over a month with weak excuses as to what was happening with them, we finally got him to finish our taxes with less than two weeks before the April 15th deadline. He charged us over $450 and we found three mistakes...mistakes that would have cost us money - thousands to be more specific. He didn't appolgize for the errors, nor did he lower his preparation fee, however he did correct the forms. In addition he didn't have any clue how to handle our previous state's filing that we had to do. We had to take care of that ourselves. So...certifications and degrees are no guarantee. Thank goodness we knew enough to be able to comb through the return and question the things that we saw.

 

[mickeysgal]

Also, don't assume any CPA will do your taxes correctly. If taxes are what you want done, you should get an EA - Enrolled Agent. Taxes are a specialty for EA's and the EA certification is not an easy one to acquire. Of course, there are CPA's out there that specialize in personal tax issues, but when you get an EA, you KNOW they know taxes. The public accounting firm I worked in was all EA's - no CPAs. You wouldn't believe some of the messes that we encountered when people would come to us after using a CPA that wasn't knowledgeable in taxes. Also, EA's have a special designation that allows them to represent you before IRS.

ow...thank you! This is very valuable information to know!

 

[Brier Rose]

Thank you all for your best wishes!
I still don't know anything yet. DH had some things that had to be taken care of this morning, and then he's going over to H&R Block to see what they plan to do. I am NOT going with him!

I keep trying to put things in prespective you know.
I mean it is ONLY money! NOT that I want to have to pay any more than we have to..of course. It's just that in the grand scheme of things it could be so much worse!

I'd much rather be sitting here sweatin' the issue of money, rather than say..medical test results. As long as we are all ok, I'm ok!

I'm not as worried about it as I was last night, but I really wish DH would hurry up, so I will just know SOMETHING! Good or bad..I just won't be able to relax until I know what's up!

If we owe..we'll make a plan to pay it, if we don't..I'm going out to dinner! H&R Block BETTER cover the penalty and interest though!

Also, don't assume any CPA will do your taxes correctly. If taxes are what you want done, you should get an EA - Enrolled Agent. Taxes are a specialty for EA's and the EA certification is not an easy one to acquire. Of course, there are CPA's out there that specialize in personal tax issues, but when you get an EA, you KNOW they know taxes. The public accounting firm I worked in was all EA's - no CPAs. You wouldn't believe some of the messes that we encountered when people would come to us after using a CPA that wasn't knowledgeable in taxes. Also, EA's have a special designation that allows them to represent you before IRS. Good luck to you.

Great information! Thank you very much, now I will know what to look for!

I'll let ya'll know something as soon as I do. Thanks again for all of the support!

 

[Brier Rose]

Well guess what...THEY OWE US $127.00!!

I can't believe it, I am sooooo happy! They lady that looked them over today said she had No idea how the guy that did our taxes screwed up as bad as he did!

It was actually worse than I thought, because not only did he not list any of our contract labor, he didn't depreciate any of the work trucks, and didn't list any of the fuel expences! He left off $19,000 worth of fuel expences!!!

So bacially the extra income got cancelled out by the things that didn't get put on the return.

They even still had a copy of the sheet where I listed all the deductions in detail, so there was no way she could say we just didn't disclose that at the time he did our taxes.

She was very nice and helpful, BUT, we still won't be using H&R Block again!

She did say that we would most likely be getting some more letters from the IRS, because it can take a few weeks for them to process the amended return, but for us to just bring any letters to her, and she will handle it!

DH said she acted like it was no big deal, and she even said it happens all the time!! WOW!

Anyway...just got back from dinner. I have to say, it's one of the best meals I've ever had in my whole life!

Thanks for all the help!