ComplaintsforFranek Tax Services

• Initial Complaint

  12/09/2022

  Complaint Type:

  Product Issues

  Status:

  Answered

  More info

  We've used Franek Tax services for several years now and have been pleased. When we contacted *** in March 22' to do our taxes, he was responsive (via email) but did tell us that he would need to file an extension on our behalf. When we reached out in June, the excuses began and were repeated in July, August, and September. Excuse after excuse. In October, we received a bill from the IRS stating that our taxes were filled late with no extension. *** found it was a clerical error and stated the office would take care of the bill. Unfortunately, he would need to pay us in installments; write a payment plan with dates. After the initial payment, we are still waiting to hear from Franek Tax Services, with the exception of one email from ********* that states they will only pay something else once we prove that we paid the IRS. I responded immediately, and emails and voicemails go unanswered, and we couldn't be more disappointed that this is the situation we're in. We were sympathetic to their situation (Apparently, ********* had to have several surgeries. It is *** and his wife, *********, who run the office) and agreed to his payment plan, but that was over six weeks ago. Every time he said to come to the office, it was closed. We mailed the IRS full payment in October, but that check has yet to be cashed. As of today, we have only received a $600 check payment towards the $1260.00 bill. We have emails stating they are at fault and when we filed a complaint with the NC Board of CPA this business or *** Franek himself is not nor has ever been licensed in the state of North Carolina. We had NO idea he wasn't licensed- he sells himself as a licensed preparer. We want the monies that he admitted he owed to us.

  

  Business response

  12/09/2022

  Dear Sirs;

  My name is ****** ****** and I am the owner of Franek Tax Services. I have been doing Tax Preparation for over 30 years and over 15years in the State of North Carolina. My firm does Tax Preparation, Accounting & Tax planning for my customers. I have both Business customers who file either an S-Corporation or Partnership return and Individual Tax Customers who file 1040 returns & associated State returns. Most of my customers file a NC State return since most do live in North Carolina. I also have several customers who file additional State returns since they either live in a different State or live in NC but file a Non-resident return in another State. The Complaint in question arises from the Federal S-Corporation return filed for this Taxpayer. I also filed a 1040 return for this Taxpayer as well. It does appear that when we attempted to file an Extension for their Corporation Tax return back on March 15, 2021 something went wrong and the extension was not filed. This was our mistake but due to a reduced staff due to COVID this year, we had a backup of returns to be put on extensions; I had no idea that the S-Corporation extension was not accepted until we filed the completed S-corporation and the Taxpayer received the Penalty notice from the IRS for late Filing of the 1120s or S-Corporation for their Business. We have no Idea as to their complaint of not responding to their E-mails. We did in fact respond to their E-mail first asking for a complete copy of the IRS complaint. It has always been the policy of Franek Tax Services to pay for any outstanding loss incurred by our customers due to an made by us. Taxpayer demanded first a full refund for the IRS Penalty. Since it was near the end of the Season I did ask the Taxpayer by e-mail to contact the IRS to see if the Penalty could be reduced; I did explain that any payment made by the Taxpayer to the IRS will be refunded by us. The Taxpayer responded back to us that the IRS gave them the Option either to take a ONE-TIME abatement where they would owe nothing (this is a common practice by the IRS on First Time Corporation Penalties) or pay the full amount owed. Taxpayer advised that he would not take the One-Time offer from the IRS and that they would pay the amount owed. I Advised that we would reimburse him for that amount he would be paying the IRS. The Taxpayer accepted my payment proposal and we issued a check to the Taxpayer for $600.00 as First Installment. We would pay an additional $300.00 by mid November and the Final Payment of $360.00 by the end of November bring the Total reimbursement to $1260.00. Since they had already received the Initial payment of $600.00 and we had no proof of payment to the IRS, we did request either a Bank Statement showing the payment to the IRS by either Check or Credit Card payment. We had no response from the Taxpayer on this and we did send at least two E-mails requesting proof of payment. We finally did receive an E-mail requesting the balance of the amount due but they could not give a any proof that payment was actually made to the IRS. It is our policy to pay any out of pocket expense incurred due to our mistake. Proof of this was our Initial payment of $600.00 as part of our agreement to reimburse them for their payment to the IRS. It appears that the Taxpayer did in fact agree to the One Time abatement from the IRS and no payment was made to the IRS from my Customer. Since we pay for the penalty paid whether we pay up front or by Installment, it appears that no such Out of Pocket expense was ever Incurred. I will be happy to pay the balance of $660.00 as soon as I receive proof the the payment was actually made. If no expense was Incurred by our Customer we feel that no additional payment is required. The Taxpayer/Customer has already received a check for $600.00 and has cashed it. I do not expect to get that amount back but we will need proof of the full payment to the IRS before an additional payment will be made. As to the last part of their Statement, I am not a CPA and have never advertised that I was. heir would be not record with the NC Board of CPA's since I am not a CPA. I have been doing taxes in North Carolina for over 16 years and before that in NY State. I do follow the IRS Professional Tax Preparer program every year since that compliance system has been in effect, I think since 2015. It is a Voluntary Program by the IRS since they were denied by the courts to make this program mandatory for all Paid Preparers. The program requires at least 16 CPE credits each year and the passing of a General exam prior to 12/31. I usually take between 24 to 28 credits per year and pass the Test. The IRS has a list of these Preparers who complete the program. For the record I have never told my customers that I was a CPA or Advertised that I was. Again, for the record we feel that the taxpayer/Customer has not had any out of pocket expense due to this S-Corporation filing. If any proof of payment is received by us, I will be happy to reimburse them for the Total original penalty amount Incurred if actually paid. The $600.00 paid to them is theirs to keep again for any Inconvenience this might have caused them. Thank you.

   

  Customer response

  12/09/2022

  
  Complaint:****** **
  
  I am rejecting this response; it's illegible and unprofessional. I have submitted all of our email exchanges from Franek Tax service. After he gave the first payout following the timeline *** drew up (after we showed proof of the IRS late fee), he refused to acknowledge us either by email or by phone. We received one payment, and then he will not give us the money owed to us due to his error but made sure to cash our check for $1600. The IRS gave us a fee due to *** Franek's error, and we have assessed that fee. The money is owed to us rightfully, and we shouldn't be forced to wait to show him proof whenever the IRS cashes the check. We agreed to the terms he wrote up, and you should keep the agreement the same mid-timeline. Anything short of this is unprofessional; we paid for a service from Franek Tax service was assessed a fee due to their negligence, and all we ask is to be made whole. 
  
  Sincerely,
  
  ****** *******

  

  Business response

  12/12/2022

  This is our Second Response to Complaint number ********* We received the latest response from the complainant. I am told that based on my actions in this case that I am Unprofessional. As I noted in our prior response we responded to the Customer's email as to the IRS penalty imposed and requested a copy of the Notice. I responded back to the Taxpayer by phone and I think by email to call the IRS in order to see if the Penalty could be reduced (We are aware of the IRS practice to waive the Late Filing Penalty on an S-Corporation on a First-Time Filing error). Also advised the Customer that the IRS might offer this to him. The Taxpayer wanted full Reimbursement of the Penalty assessed and I advised that we will be more that happy to Reimburse him for any amount that he pays to the IRS. The Taxpayer is responsible for any payment to the IRS or any State for payments or penalties due; our practice has always been to reimburse the Taxpayer for any amount owed to the IRS or State taxing authority If amount was actually paid by the Taxpayer. We have always requested some proof of payment especially when the amounts are over $100 or more. We received a call back from the Taxpayer advising the the IRS gave them the option to have the penalty waived due to a First Time S-Corporation Penalty, or not to take the waiver and pay the Full Amount Owed ($1260.00). We agreed to PAY the amount owed to the Taxpayer but we needed to do it in a 3 payment Installment package since it was at the end of the Tax Season and we did not have the Sufficient funds available. At First the Taxpayer would not agree to a payment plan since as he noted, had already paid us for the return; later they agreed to the payment plan and we issued a check for $600.00 for the First payment, which the Taxpayer picked up at our Office. I did request when we spoke and at least two times by email that since the Taxpayer issued a check or paid by card to the IRS that we required proof of payment either by canceled check or printout from bank showing a Credit Card Payment. As to the amount paid for my services, their bill is for both the Business S-corporation return which we charged $825.00 and their 1040 Individual tax return in which we charged $455.00: Total bill that was paid by Taxpayer was $1280.00. After the attempts to get that payment proof I advised the Taxpayer that as soon as proof of payment is made, we will issue a check for the balance of the payment due them. We had no problem issuing them the First Installment since we were acting in GOOD FAITH, even without the proof of payment. The Taxpayer notes in this recent complaint that the money is owed them and that they should not have to wait for the IRS to cash their Check. The IRS for the most part cashes these checks within a week of receiving that check. All we ask is that the Taxpayer supplies proof that they actually paid the full amount of $1260.00 to the IRS. If proof of payment cannot be supplied then we feel that the Taxpayer did, in fact take the wavier and never made a payment to the IRS.  As I noted on my original response that the error was our mistake and that the S-corporation had to be filed by March 15th. The taxpayer was advised that we had placed him on extension and he was not advised of the error until we submitted his return in September 2022 and he received the Penalty notice from the IRS in November. We accepted the responsibility and we have no problem with paying the penalty owed since he advised that he would not accept the waiver. All we asked of the Taxpayer is that proof of payment be supplied us before the balance ($690.00) is Paid. This is what we have requested since the Initial payment of $600.00 was paid to the Taxpayer.  Thank You.

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