Complaints

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• Initial Complaint

  Date:04/27/2023

  Type:Product Issues
  Status:

  AnsweredMore info

  Complaint statuses

  Resolved:

  The complainant verified the issue was resolved to their satisfaction.

  Unresolved:

  The business responded to the dispute but failed to make a good faith effort to resolve it.

  Answered:

  The business addressed the issues within the complaint, but the consumer either a) did not accept the response, OR b) did not notify BBB as to their satisfaction.

  Unanswered:

  The business failed to respond to the dispute.

  Unpursuable:

  BBB is unable to locate the business.

  I used this company (specially, the office in Cottonwood, AZ) for tax services over a 3 year period for tax years 2019, 2020 and 2021, including some complex tax concepts that I was not comfortable handling myself. During the 3 year period, there were 2 errors. The first year, a $1,000 tax refund for solar was not properly claimed on the state return even though the corresponding credit was claimed on the federal return. Company filed an amended return at no charge since it was clearly their mistake. In the other 2 years, an adjustment to income was not included that resulted in an overpayment to the IRS and state. Customer discovered all errors. Company claims no responsibility and is attempting to charge customer $225 per year to file amended returns and recover the overpayment, even though customer notified them that he was eligible for the income adjustment on their Yes/No questionnaire. Customer acknowledges that he did not provide the relevant amount, since the provider did not mail supporting IRS tax form to customer until after the April 15 filing deadline (which apparently is acceptable for this particular item). Customer feels that company had an obligation to ask customer for relevant amount prior to completing initial filing work given (a) company properly accounted for the income adjustment in year 1 so company had knowledge that it was applicable, (b) customer answered appropriately for this item on their Yes/No questionnaire and (c) apparently providers are not required to supply the supporting IRS tax form (Form 5498) to taxpayers prior to April 15 deadline because additional contributions can be made and applied to the prior year. It also took 3 weeks to get a response on their fee for amended returns.
  
  In my view, customer and company both have some responsibility. A $225 fee (per year) is unacceptable given that company has all data in their system and could have prevented the error had they completed proper due diligence.

  

  Business Response

  Date: 04/28/2023

  It is a violation of our privacy policy to disclose taxpayer information outside of our office, however, we wish to provide some context in regards to this former client's statements.  

  All clients have the opportunity to review their tax return before providing our firm with permission to file a tax return.  The customer signed, under penalties of perjury, that he had reviewed the tax return and its accompanying statements.  This signature finalizes the tax return and approves the return for electronic filing.  Once the tax return is approved, client copies are provided and source documents are returned, the engagement is ended.  

  Customer states that he believes that we have a post-filing responsibility, which is incorrect.  Further work on the customer's behalf is considered to be a new engagement, and is subject to engagement acceptance protocols and new fees.

  Red Rock Accounting Group is proud of the work that we perform, but we acknowledge that errors do take place.  We are happy to fix errors which are our responsibility at no additional cost.  However, we believe, and the customer acknowledges, that there was not an error on the return, but instead an omission which was not of our doing.  We can only prepare a return with the information provided, and the customer failed to provide the information necessary to claim this specific deduction. 

  While we regret that customer waited an extended period of time to hear about the amended return fee, the customer fails to state that he brought us this request during the busiest time of the year for tax preparation firms.  The issue, which was not time sensitive, needed to be reviewed in order to determine the most accurate resolution.  

  We hope this provides valuable context for this unfortunate situation.  

  Customer Answer

  Date: 04/28/2023

  Please refer to page 10
  of the company's 2021 Client Organizer, "Did you make contributions to a
  Health Savings Account (HSA)...", customer clearly marked the box for
  Yes.  Company failed to perform simple due diligence by asking the customer
  to clarify whether they made such contributions since there was no
  documentation.  Given that HSA providers are not required to supply a Form
  5498 until after the April 15 filing deadline, perhaps the company should
  include this instruction on their Client Organizer.  If the company feels
  they have no obligation to provide any more assistance than a self-serve data
  entry program, they shouldn't charge fees that are 10 times higher than a data
  entry program.
  
  Also attached:  (1) emails from 2021 where
  customer specifically asked whether after-tax HSA contributions had an impact
  on the tax liability:  "Is the HSA amount actually lowering my
  taxable income in some way?"  Customer's request went unanswered by
  company. (2) emails from 2020 where customer provided the HSA contribution
  amount as a result of the company's request to do so.  Company will likely
  argue it was a one-time courtesy. 
  
  Regarding the delays in obtaining the company's
  fee during the busiest time of the year (1) company could have provided the fee
  during prior discussion in Feb 2023 instead of stating "we will have to
  bill you for our time on this."  (2) If $225 is the company's
  standard fee, regardless of complexity, company should educate its employees
  since two employees stated the opposite: "There is no standard fee for an
  amended return, it depends on the work involved".  Another example of
  the poor customer service received.
  
  There is clear evidence that company could have
  done more to assist the customer.  Company refuses to accept any
  responsibility or make an exception.  How much time it would take to input
  one new amount for an amended return to justify the $225 fee?  Company has
  made it clear they did not value the customer's business.

  

  Business Response

  Date: 05/01/2023

  We have reviewed the taxpayer's comments and documents submitted.  The taxpayer provided the firm with information on the 2019 organizer noting specifically how much the HSA contribution was.  The amount was duly accounted for on the 2019 tax return.  This indicates that client knew that he could provide this information at the time of preparation, and that he did not have to wait for a Form 5498, which come after the filing deadline.  The client did indeed mark the box that contributions were made, but 99% (or more) or taxpayers make HSA contributions by virtue of payroll deduction.  Information pertaining to the client's HSA contribution was supplied on Form W-2, which lead our preparer to believe that the information was complete.  Had the client included similar information to 2020 as he did in 2019, we would have included similar deductions.  However, this information was omitted.  

  As discussed previously, all clients receive a review copy of the tax return.  The taxpayer had the opportunity to review the return and ask appropriate questions.  The taxpayer's satisfaction with the return is confirmed by a hand or electronic signature which authorizes us to transmit the tax return to tax authorities on their behalf.  At that documents are returned to the client and the return is finalized, so is the engagement.  The firm is under no obligation to provide further services, much less services for no renumeration.  

  The taxpayer has elected to disengage from this firm, and self-prepared his 2022 individual income tax return.  The taxpayer believes that preparing the amended forms is simple and is just a press of a few buttons, and that does not hold true.  We have provided a good-faith quote for a firm minimum fee to produce the amended return, which he has rejected.  Our obligation to the client is therefore fulfilled and our file is closed.  

  Customer Answer

  Date: 05/04/2023

  While 99% of other taxpayers
  may make HSA contributions via payroll deductions, clearly that was not the
  case for this taxpayer as evidenced and agreed to with company starting in the
  2019 tax year.  And that is precisely the point.  Given the company had direct knowledge of the
  customer's after-tax contribution arrangement, customer contends that BOTH the
  company and the customer had a responsibility to account for this in subsequent
  tax years.  Customer acknowledges his portion of the responsibility. 
  It is very concerning that the company refuses to accept any responsibility
  given the clear fact pattern.

  In 2019, the
  customer provided documentation of the after-tax HSA contributions only AFTER
  it was specifically requested by the company.  The customer is simply suggesting
  that the company could have performed the same level of due diligence in 2020
  and 2021 as they performed in 2019.  But they did not.  Pushing that
  obligation onto the taxpayer seems rather convenient, especially given the fact
  that customer specially questioned how these contributions impacted his taxes
  but was ignored.  Attached is tax
  form 1099-SA for the 2021 tax year which was provided to company, showing the
  customer’s HSA distributions of $2,901.48 in 2021.  A similar form was
  provided in 2020.  Since the company only accounted for an $800 HSA employer
  contribution (not the customer’s personal contribution), how does the company
  explain the fact that they completed the tax return showing the customer had
  over $2,901.48 in HSA distributions?  This was a clear red flag that should
  have been questioned. 

  Customer has already manually
  completed a federal tax form for 2021, including all accompanying schedules and
  worksheets, and therefore is aware of the complexity or lack thereof.  Upon realizing that this omission also
  impacts the AZ state return, customer requested assistance.  The fee is unreasonable and apparently a
  payback for customer ending his services with company.