By Michele McDonald
LaFonda Merrick isn’t joking when she says tax season can be a curse.
"The guy sat and started doing all of these gyrations and breathing heavily," the Idaho accountant recalled. "It was the funniest thing. I had clients in my office and he was sitting there, putting a hex on my business."
He put the whammy on her after she refused to hand over unpaid work.
"I’m afraid that I didn’t react well because I laughed at him," she said. "He stormed out--all the while spitting and doing things with his fingers."
Curses are rare, but the tax season pressure-cooker brings countless surprises, office punch lines and the occasional knotted tangle of wives, girlfriends, and children.
It's been 20 years since Merrick’s business got the evil eye. The jinx hasn't brought bad luck, but did provide the best tax story of her career. It started simply enough: an IRS audit prompted a new client to seek tax help. She hadn’t done the original return, so she asked for a retainer. He owned a used car lot and reported only $20,000 in income but had sales in excess of $1 million . He lugged in four boxes of receipts.
"I worked overtime," Merrick said. "I spent hours going through the receipts and cataloging them and getting all the work ready for the audit."
The retainer quickly ran out. She asked for more money. "They kept putting me off and begging me to go to the auditor."
After several weeks, Merrick finally told the auditor she’s no longer on the case because the client wouldn’t pay her. The auditor called the car dealer to tell him he’s on his own. After that, things got weird.
"They came in and were so mad," Merrick said. "They wanted me to give them all the work they hadn’t paid me for. I said, ‘No, you need to pay me.’ I knew that they were gypsies. When I had gone to their office, their mom had a palm reading sign out in front. But I don’t believe in it. I didn’t care one way or another."
In the end, the client did get the files. Not because he paid Merrick but because the IRS criminal investigations division subpoenaed them from her.
"They wound up in criminal court," Merrick said. "All they had to do was keep paying me and I would have kept working with the auditor. She was being very forgiving on the record keeping. I thought the auditor was being very fair. I suspect CID wasn’t quite as forgiving."
As for Merrick, her business certainly hasn’t been jinxed. It expanded from a single one-room office to a dozen. Her grown children are graduating with accounting degrees and entering the business.
"Maybe CID coming in lifted the curse," she said, laughing.
Dealing with families can be tricky and sometimes downright tangled. Rhode Island accountant, Susan Gentile accepted what, at first, seemed a straight forward piece of work on April 12 this year: one W-2 and no itemized deductions. Then came the three children, three wives, and one girlfriend.
"It was just hilarious," Gentile said. "The story kept going on."
Wife No. 1 has at least one child. Wife No. 2 adopted at least one of Wife No. 1’s children and has two total. The client, now married to Wife No. 3, wanted to file separately from his current wife.
"I didn’t dare to ask where the girlfriend came in," Gentile said. The client also has a child with his girlfriend.
He wanted to claim all three children as dependents to earn child tax credits. Wife No. 2 signed a release for the client to claim two children as dependents. As one child was 17, only one child credit was applied. He couldn’t claim the third child because he couldn’t find the girlfriend.
"You have to be tactful about these things," Gentile said of how she unwound the information.
The client wasn’t happy about applying only one tax credit. "He had a puss on him when he came to pick up the tax return," Gentile said.
Clients get worked up because money is so personal, a Virginia accountant said. Accountants learn about their clients’ private, not just financial, lives, especially during divorce. Clients want her to talk with their exes and work out the problem, she said.
"You’re just getting caught in the middle of family messes," she said. "I’m the impartial CPA. I’m not taking sides."
While not taking sides, some tax payers want their accountant to bend strict tax rules. Take the UPS delivery driver who five years ago pressed Minnesota accountant Ellen Stebbins to help him write off cosmetic surgery.
"So he told me he had liposuction on his legs because he could wear shorts to work and his legs needed to look great," Stebbins wrote in an email. "I said ‘No, that wouldn't be deductible.’ He wasn't happy, but is still a client."
Don’t overlook anything when it comes to deductions, advised Arizona accountant George Montgomery, who takes on per diem work for another CPA and was asked to give a second look to some past returns filed by a financial planner. The planner had skipped using a depreciation schedule on the tax payer’s rental properties. With a few keystrokes, Montgomery quickly nabbed the tax payer a $30,000 refund for two years of past returns.
Sadly, Montgomery missed seeing the tax payer do a jig.
"I didn’t get to meet the client," Montgomery said. "That’s the fun part of working with returns. I didn’t get that payoff."
Tax prep is about more than numbers--it’s the clients that count. Still, quirky clients can provide tag lines, just the mention of which can prod laughs around an office for months. Sandra Hall’s officemates throw out "Well, it’s in my toolbox" or "Hell, I don’t know" as in-house catch phrases.
An electrician started a side business along with his regular job. Hall asked him to make a list of his expenses, mileage, and such and drop off these "tools" so she could look them over before their meeting. She opened the folder, which contained a single 1099 form and none of what she requested.
Hall then had the following phone conversation with the client:
"Where are your tools?," she asked. The client didn’t understand, "well, they’re in my toolbox," he responded.
"Where’s your mileage log," she queried. The client replied, "Well, I kept my mileage log on my phone and I dropped my phone."
As it wasn’t going so well at this point, Hall asked: "All this started with a toolbox. Do you want to deduct your toolbox?"
He did, of course. Much work later, Hall finished the return.
After that, whenever someone in her office needs to find something the shout-out is "Well, it’s in my toolbox."
Another client, a gentleman farmer who uses his law degree to finance his farm, doesn’t keep exact records. "Hell, I don’t know" is his answer to most questions, including how many head of cattle he owns. Or another favorite reply: "What does it need to be?"
Hall quipped back, "That doesn’t work for the IRS or for me. I need to legally know what it is."
And just like accountants tell tax payers what they don’t want to hear, clients sometimes return the favor. One of Merrick’s clients helpfully handed her a card for a plastic surgeon to get the bags under her eyes removed.
"If you were working from 5 in the morning until 10 at night, you’d look tired too," Merrick joked. "Come and see me in the summer when I’m well rested!"
Then it can be the accountant who inadvertently says the wrong thing. Accustomed to chasing down one particular client, a Virginia accountant kept leaving cheerful but escalating inquiries about his extension. His wife called to tell her that her mid-40s husband had died suddenly from a rare illness.
"I felt terrible," the accountant said. "Here I am hounding him…thinking he’s off being busy."
The best-learned lessons can come from clients. Just starting out in the early ‘80s, Washington accountant Karin Ho went to every business gathering and handed out cards right and left. She met a well-dressed young man who needed tax advice for his diamond business. She didn’t know anything about the diamond trade but decided she could learn.
When he came to see her at tax time, a few things had changed. "Little did I know!" she laughed about what she soon learned. The young man had traded the diamond business for a massage parlor in the not-so-nice part of town. Her first impression turned upside down.
"I panicked and was filled with horror," Ho said. "My heart dropped into my knees."
In those days she worked from a corner in her kitchen. With the appointment already set, she quickly changed the venue to a nearby library to meet the young man and a woman who also worked at the massage parlor.
As it turned out, they wanted to learn how to do their books correctly and worked hard to do so. No crazy deductions. That meeting changed how she looks at clients. "It was an unexpected outcome," Ho said.
She didn’t hear from them again after a few months. Still, that meeting from the "other side of town" sticks with her.
"You never know who will get your card," she said.