Considerations for switching accountants?

Question

I had a bad experience with my accountant this year. Normally things have gone smoothly enough. But this year was complicated, and I didn't help myself by doing some stuff (not relevant here) to make the return even more so.

However, in my dealings with him this year, my accountant was rude, borderline abusive, and seemed incredibly disorganized when he called me in for a second appointment to clear up some questions about the paperwork. I really don't want to return to him again but have these concerns:

1. Do I need anything from him regarding my past returns that I would need to provide to a new accountant? Something that would require me to go ask him for it?

2. Is there any way I can double-check the return he is filing, to get any sense of whether anything is wrong in it? I realize the barn door is already open - they have e-filed and I have sent in my tax payments (no refund for reasons alluded to above). He and his assistant muttered something like "you will get an IRS notice" when they were puzzling over how to handle that complicated tax item. That scared me, but I did not feel I could say anything because I understand even less of the issue.

Anyway, I realize I probably made several mistakes and would be happy to hear about how I can be a better tax client, but as the title indicates, my main concern is how I can switch to someone better with a minimum of headaches.

Thanks for any help.

Answer 1

I've been through a similar experience. Consider the following:

1. Since you've done so much prep this year with the current CPA, stick with him for your 2014 taxes. Keep the relationship as amicable as possible.

2. Pay him for his work and make sure you get all your forms and paperwork back from him. If he still has paperwork from previous years, ask for those files, too. You really just need a copy of all your tax returns and any supporting documents (W2, 1099, investment documents, etc) that were in his possession.

3. Get a new accountant for next year. Take your time and get a good recommendation.

4. Show your new accountant your 2014 return and ask him to review it -- it's something he or she will have to do for your 2015 taxes anyway. Get a second opinion on how it was prepared.

You can always file an amended 2014 return if there was a significant problem.

Related anecdote: In my case, my concerns were valid and my previous accountant made several mistakes. I had to refile two years as a result. I ended up taking him to small claims court to recoup my costs of refiling with a new accountant (and won, yay!). This was an extreme case, though, so don't let that scare you. Refiling was painless and my new accountant rocks.

Answer 2

First of all, as someone who works in the tax accounting industry, I am so sorry to hear that you were mistreated by a CPA. It is a CPA's professional responsibility to treat clients with respect, and your CPA acted in a very unprofessional manner.

1. He should have provided you with a copy of your return when he filed it with the IRS. By law, return preparers are required to provide the client with a copy of the return, and it cannot differ from the copy filed with the IRS. As long as you are reasonably sure that the copy he gave you is what he also filed with the IRS, then just bring that copy to your new tax accountant/preparer, and ask them to review it for accuracy. If they spot an error or find a needed adjustment, they can help you file an amended return.

2. Your return preparer is required to obtain your signature on the return, and presumably you read through it before signing it. It is illegal to file a return for taxpayers without first obtaining their signature. You also must sign Form 8879 which authorizes a return preparer to e file your return. Also, don't be too afraid of IRS notices. The IRS will usually try to resolve any disputes with you before taking you to court. They have a lot of returns to process, so they usually take people to court only when there is a serious issue and no way to resolve it outside of court.

3. In terms of being a good tax client, the best thing you can do is send your tax preparer any W-2s, 1099s, brokerage statements, and any documents/forms/papers you think might be relevant to your tax return. If the return preparer doesn't need everything you send, they should be grateful you provided them with as much information as possible. It will give them more confidence that you are being honest about all of your income, and generally, the more documents a return preparer has, the easier it is to prepare a return. Usually, the return preparer will scan all of the documents into one file and highlight/annotate to keep track of where everything goes on the return. Any unused documents will be labeled as such. Aside from providing documents initially, also try to answer any questions the preparer asks you to the best of your ability. If you don't know the answer to a question or find it confusing, don't be afraid to ask for clarification. A good tax accountant will be happy to clarify anything you find confusing about your return, and should also be available throughout the year to assist you with tax matters that arise during the year.

4. In terms of picking a good tax accountant, there are several things you should look for. First, you should avoid accountants who are harsh, impatient, or otherwise unprofessional with you. If they seem rude to you during the consultation, trust your judgement and find someone who treats you with respect. There are plenty of good CPAs who would be happy to have your business. If your accountant makes you feel bad for not providing everything you need to prepare your return, ditch them and find one who understands that oftentimes, preparers will need to ask clients for clarification/additional information. Rarely have any of the clients whose returns I have personally worked on provided us with all of the information we need from the first consultation. When we need clarification or additional documents, we simply send the client a friendly email detailing exactly what we need and why. This is how a good accountant should be communicating with you. They should never be rude, harsh, or abusive.

I hope all of that information helps, and I hope you've found a tax accountant who treats you with the respect you deserve. The only way you could truly be a "bad" client is if you refused to cooperate with your accountant or intentionally hid income from them, but that definitely doesn't seem to apply to you.