Initial consultation error | Sales training on tax solutions


    Due to the IRS’s workload, tax cases can take up to 12 months or more to resolve. A lot can change in the taxpayer’s financial situation during this time compared to when you first saw the client. I recently had a coaching call with one of my Platinum Mastermind Members. He said, “Mike, I had this situation when I got a client about eight months ago. When I had my first consultation, they were an ideal candidate for an Offer in Compromise (OIC). They had a payroll tax situation and we are now eight months into the case. During our first meeting, I told him what settlement range he could expect based on the information he had presented to me and my historical experience with cases like his. m putting together the package with all the original documents after a few months, I understand that the customer is not entitled to an OIC.’

    After he realized this, he had to have a very uncomfortable conversation with the customer. The customer was indignant and asked for a refund. All this could have been avoided. I also learned this lesson the hard way, and I want to save you from making the same mistake.

    The way not to end up in a similar situation starts with the initial consultation. During this appointment, you fill out what I call a “mini-433A.” This is a one-page cheat sheet that provides you with all the necessary information requested on the official IRS Form 433-A to diagnose a case. After you review the information, you provide your prescription for the solution and specify the fee in the engagement letter.

    Many technicians walk the customer through the mini-433A, but they often miss one important step. You need to get the client to sign and date that mini-433A and explain to them if there are any changes to the information they have given you that affects the outcome of their case. If there is a problem after eight months and the customer is not satisfied, you can produce a mini-433A that the customer has dated and signed. This is what the client presented to you at the initial consultation. This is what you used to diagnose the case. This is what you used to assign the board. If the customer has missed information or that information has changed, it will affect what they do and don’t have. He can’t be upset about what you told him eight months ago because your diagnosis was based on the information he gave you at the time. The date and signature on the mini-433A confirms what he told you at the time you diagnosed the case. If the client understands that your work and diagnosis was based on the information, HE is under the condition that he will not ask for a refund. Also, if Mike had met the client’s expectations throughout the case, he wouldn’t have had to have this awkward conversation.

    You should use every opportunity you have during those eight months to talk to the client. I have a 14-touch customer assurance system where you provide updates on the customer’s status every 28 days. Every time you reach out to a customer, you are managing their expectations. Even if your contact is just to let them know you’re still in withholding mode with the IRS. This lets them know that you have not forgotten their case. By doing this, you have fulfilled the most basic expectation that you will keep them informed of what is happening with their case. Don’t wait until eight months have passed and say, “Hey Joe, you’re ineligible for an offer because of X, Y, and Z.” When a customer experiences radio silence from you for months and you check in only to deliver bad news, they wonder why they’re paying you and what you’re doing to solve their case. Once you can produce a dated and signed mini-433A from your first meeting, use this to have an intelligent and informative discussion with your client about why they are not OIC compliant and what options they have to resolve their case now.

    Another reason it’s important to go through the mini 433A and get the client’s date and signature is that the information the client gives you during the initial consultation may be accurate at the time, but may change over time. They may have disclosed everything about their financial situation and given you a complete picture of all their assets, but this information, while accurate at the time, may change. For example, a client tells you that their home is worth $200,000 and they have a mortgage of $160,000. Eight months later, the new value of the home due to the current state of the real estate market is $275,000. He still has an outstanding mortgage of $160,000, but due to the equity increase in his real estate, he is no longer a candidate for OIC. Since you have his written statements from eight months ago that say the house is only worth $200,000, you can show that it wasn’t your mistake, but that the information changed. The increase in the value of his home changed his eligibility for OIC. You produce a dated and signed mini-433A and review it with the client, which formed the basis of your initial diagnosis.

    This signed and dated document will help you meet the client’s expectations. This gives them the responsibility of providing you with accurate information to correctly diagnose the case and lets them know that if the information changes, the diagnosis and outcome of the case will change. Don’t forget to fill out the mini-433A and get the client’s signature. This will help you manage the client’s expectations and set the tone for a good working relationship.

    For more information on how to manage client relationships, as well as information on sales, marketing and everything you need to know about running a profitable tax settlement business, follow the blog and our social media posts.

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