Cheap client story

[PATAX]

Years ago, I raised a clients bill by $5 to I believe approximately $85, this was for both the federal and the state... The client was not too happy and immediately mentioned the $5 fee increase... I told him that I could not believe that he was actually complaining about that... He replied " I have a lot of property tax to pay"... I told him to pay me whatever he wanted to..... he paid the full amount and said I will see you next year ..... Oh by the way, he was not poor in any way, shape, or form... Poor people have shame and they never complain about the bill because they do not want you to know that they are poor.... Just my opinion.....

[BobKamman]

The wealthy are penny-pinchers because that's how they got that way.  Well, OK, at least 10% of them.  the rest, it's mostly inherited.  

[PATAX]

👍 you hit the nail on the head Bob...

[IRonMaN]

The CPA firm I first worked in was founded by an old ex-IRS agent.  He had retired by the time I started but I heard plenty of "Elmer" stories over the years.  He once had someone question his secretary about the preparation fee.  He overheard the conversation, walked up to the client, and asked to see the return.  He grabbed a good hold of the return, ripped it in half, tossed it in the garbage can and told the client not to let the door hit him in the a$$ on the way out.  When I first started my practice, my response to your client would have been the same as yours PA.  But after a lot of years with dealing with all sorts of personalities, my current treatment would be the "Elmer" treatment. 

[PATAX]

You hit the nail on the head Iron Man... I also learned over the years that some people equate quality with the fee... Therefore tax preparers should not undercut themselves and should charge an appropriate, but fair fee.... Just my opinion

[BobKamman]

There were surveys, probably a couple decades ago, on average fees.  They found that "old" preparers were charging less than "new" preparers even though they had more experience and knew the clients better.  What happens is that many people think their clients are their friends, and they don't like asking their friends for money.  I always suggest a large sign in front of your desk (behind the clients, where they won't see it) to remind you 'YOUR CLIENT$ ARE NOT YOUR FRIEND$" .

[PATAX]

👍 Bob, as the old saying goes "business is business"....

[USATAXLADY]

I'm always getting tips & gifts from my clients, I never understood why? They know it's my business, I tell them the fee and they give me extra! Am I not charging enough?

[PATAX]

Not necessarily... Some people are just generous and they appreciate the good job that you do and will tip you.. Some people are brought up that way...

[USATAXLADY]

I have been in this business for 45 years, I am now charging more, if I am not respected & appreciated, they can go somewhere else!  My sayings are, "Either you want it quickly or correctly, your choice!" and "Procrastination on your part does not make it an emergency for me!"

[PATAX]

👍 wise sayings USA tax lady...

[dkh]

Years ago I had a business client tell me I wasn't charging enough.  Gave me a kind lecture about being in business to make money.   

I need the sign @BobKamman suggests because I have a hard time charging "friends" an appropriate fee.

[PATAX]

👍 dkh... If you raise your fees 5% across the board for all clients, very few clients will complain and leave... And that 5% applied to your total gross receipts will be a nice pay increase for yourself... Just my opinion

[dkh]

@PATAX  I actually did a 10% increase this year ! 😁    Felt I deserved it with all the unemployment forms  I had to chase down etc etc etc                Not one client has complained or at least not to me.  

[PATAX]

I think we as tax accountants are undercutting ourselves on our fees... I had an air conditioning technician stop in last week, he was here for approximately 20 minutes or so and he charged me $325.. he only changed the capacitor on the air-conditioning which I believe is somewhere around 30 or $40 for that part... So I think tax preparers deserve a raise...

[USATAXLADY]

You are right, my prices went up this year! A lot of new clients that haven't filed for years, now they want the rebate recovery checks! The government just keeps printing money, our dollar will not be worth a penny soon!

[mdtao31]

When confronted with this i tell my clients you file your taxes ONCE a year.its not like something you pay

weekly or monthly.the threat of not doing thier taxes next year puts an end to complaining.

regards,LARRY

stay safe

[PATAX]

Exactly Larry you hit the nail on the head.. They come here once a year.. The same ones that complain go to the hairdresser or hair stylist every two weeks and pay more money than they pay us... Oh and by the way half of them are almost bald or getting there..

[taxman313132]

according to bob j, there are 9,000 new pages of tax laws this year.  you should be increasing your fees by 20%.  i raised some, but over half my clients are seniors.

[BobKamman]

Some of the people who whine about the declining value of the dollar (which is worth more in terms of the euro, pound or yen than it was ten years ago) are those paying $60,000 for a Bitcoin.  It's lucky for the Chinese that the dollar is so strong, though.  Their exports are cheap, ours not so much.  

[PATAX]

👍You are exactly right Taxman... We should be charging more across the board but we have to absorb a reduction in fee increase with many of the senior citizens since they can go to Vita and get it done for free...... just my opinion.

[BobKamman]

If they qualify for VITA that's where they should be going.  Good way to meet other seniors (different volunteer every year) and share their financial situation with strangers.  That is, if it's not one of those VITA sites where you just drop stuff off and hope it gets done when you come back to pick it up.  

Most of my clients are seniors, but I don't discriminate against my younger ones trying to raise kids by charging them more than their grandparents.  If the old folks want a senior discount, that's why we have McDonald's.  

[IRonMaN]

My prices are nowhere close to where they should be.  But when I went off to college I chose a profession that I thought I would like, not the profession that I thought I could make the most money from.  This year has been a bit challenging at times, but I still do enjoy this job.  I have made comments over the years about my clients not exactly being rocket scientists.  But overall, I have a real good client base made up of good people.  My clients put their full faith and trust in me and I try to do the best job I can for them.  I might not be the richest guy in Minnesota, but as long as I can stroll down to the Ford dealership and drive home a new pickup every 2 or 3 years, I'm content. 

[Greta]

My old-time partner would say, "How much do you want to pay?" And he'd then say, "OK, but don't come back next year." He was retired military, and spit it out fast. The client would call the following year and beg to be taken back.

[PATAX]

👍 well said Iron Man... I am also thankful that I have a good client base and I appreciate it... Thank God....

[mdtao31]

Very well put ironman

[PATAX]

👍 Greta... sounds like my old colleague and friend, Marine War veteran...... I learned a lot from him... May His Memory Be Eternal...

[sjrcpa]

I don't think VITA did in person prep this year. It's not just for seniors. Other low income people qualify, too.

I volunteered with them for a number of years. These "clients" were grateful and always said thank you.

[BobKamman]

AARP website says they do in-person at some sites. 

IRS hands out money for Tax Counseling for Elderly programs.  When I grow up I want to work for a nonprofit. 

https://www.irs.gov/pub/irs-utl/2021_vita_tce_award_list.pdf

[PATAX · Accepted solution]

All of the replies herein are very informative and should be read by all... Just my opinion...