Phil, an enrolled agent, prepares William’s income tax return. William gives Phil power of attorney, including the authorization to receive his federal income tax refund check. Accordingly, the IRS sends William’s $100 refund check to Phil’s office. William is very slow in paying his bills and owes Phil $500 for tax services. Phil should
a. Use William’s check as collateral for a $100 loan to tide him over until William pays him.
b. Refuse to give William the check until William pays him the $500.
c. Get William’s written authorization to endorse the check, cash the check, and reduce the amount William owes him to $400.
d. Turn the check directly over to William.
Phil, An Enrolled Agent, Prepares William’s Income Tax Return. William Gives Phil Power Of Attorney, Including
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Ruben G
September 24, 2009 at 5:59 pm
The answer is d.
You can’t take someone’s money without going through the legal system!
Just moi
September 24, 2009 at 5:59 pm
D is the answer. I gave my accountant a power of attorney and in most cases if not all it is limited to the filling of the forms only. Money is not included.
Pablo
September 24, 2009 at 6:25 pm
e. Extort the money and run to Mexico.
[This is a real world lawyer example, isn;t it?]