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Can a credit card company sue me for not paying my debts? |
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Slick | Is it worth taking the risk and not paying, or will I get sued? |
I earlier had posted a question about my CPA charging me $450 to do my taxes. Price was not discussed beforehand because a third party was paying for it in the past, so it was not a concern of mine. This past year I got the bill for $450 from the CPA stating that I have to pay it this year because the 3rd party won't. I emailed him back saying $450 was way too much for a single w2 filer, and I offered him $200. He says the $450 stands because he did 5.5 hours of work, and that he "knows more lawyers than I do people". Do you think he would actually take me to court for this amount? If he does, would I wind up spending more defending myself in court? What should I do here? I feel like I'm getting totally ripped off!! Additional Details I earlier had posted a question about my CPA charging me $450 to do my taxes. Price was not discussed beforehand because a third party was paying for it in the past, so it was not a concern of mine. This past year I got the bill for $450 from the CPA stating that I have to pay it this year because the 3rd party won't. I emailed him back saying $450 was way too much for a single w2 filer, and I offered him $200. He says the $450 stands because he did 5.5 hours of work, and that he "knows more lawyers than I do people". Do you think he would actually take me to court for this amount? If he does, would I wind up spending more defending myself in court? What should I do here? I feel like I'm getting totally ripped off!! Just to add to this, I never signed anything up front saying that I agreed to this price. Some of you are saying just pay him and chalk it up to experience, but does he really have a case if I didn't sign anything? |
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Jack Kerouac
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pay the 450. next time figure them out yourself....300 or so is about right.....but you should always get estimate BEFORE you get it done...withthe understanding (in writing) that if it is to cost more---you be notified in advance |
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allyson71377
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It sounds like a contract was made. Even though the 3rd party was paying, he is doing your taxes. If a contract is made, you can be sued and you most likely will lose. Just pay it and cancel your contract with him. |
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mother2one
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consider this if it is not paid, worse consequences could be in the future. |
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kadel
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He will win. You hired him and you didn't ask how much. He probably assumed you knew how much the third party paid. Why did it take 5.5 hours for a single W2? Did you buy or sell stock, do you have a home? Did you have all your receipts organized and totaled on a summary sheet under the proper categories such as donations, taxes paid, business expenses, medical expenses, etc. or did he have to put the information together? Ask him why it took so long to do the return. They usually charge $100 an hour or more so $450 for 5.5 hours is a good rate if it did take him 5.5 hours. Pay it or he will take you to small claims court and you will pay and pay the court fees and loose one half day's time for the arbitration meeting and one half day's pay for trial. I wish my accountant was that cheap on her hourly rate. |
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Studly
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Ignore tams's advice....it does not apply here since the CPA is the original creditor and doesn't fall under the FDCA.
Since many good CPA's charge more then $100 an hour, it seems like he is billing you fairly.
But any good CPA would have a simple tax return completed in well under 2-3 hours. What was in your tax return that made it that complicated?
If this were my situation, I'd send him a letter contesting the amount of time he took to do your taxes, and offer $300. If he again refuses, let him sue you.
Depending on the state you live in, it will end up costing you court costs (maybe $50-75) and legal fees ($100). But you could explain to the judge that you are strongly contesting the amount of time he took, and he padded the hours.
It's a gamble. If you lose, you end up paying more money. But sometimes you have to stand up to your principles!
Oh, and to those who constantly say call the BBB <giggle> um...waste your time somewhere else. CPA's are licensed by the state, so contact the local regulation department and complain. It won't get you much, but it will do more then the BBB. |
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stephanie7938
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It sounds like he's trying to rip you off. Especially scaring you with the lawyer thing. There is a legal advice hotline you can for free. 1-800-824-4050. Make you sure you have all your papers with you when you call. If you signed an agreement to pay a fee for his services there's a possibility he will try to sue you, he sounds like a jerk. However if the fee was undisclosed up front, then technically you never agreed to pay it. |
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marysrrn
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Don't pay and tell him you're willing to go to court. He then will negotiate a fair price with you. |
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Stephiony
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How unpleasant. Perhaps, if it is actually the case, you could write him a letter stating that in the past, the third party had not shared the information on his fee with you. If it was not at all discussed with you or written on a sign or in written information youreceived from the CPA, I would mention it in the letter. Tell him that you are not refusing to pay, but that since you were unaware of the fee, and he failed to mention it, that you are willing to negotiate. Don't say that it is too much for a simple filing because that is insulting him, in a way you would then be saying he has no right to charge that much. Ask for an immediate response. Send the letter certified, return receipt requested. If the response is not the one you like, and he continues to threaten, tell him, again calmly, civilly and in writing that you will contact the agency in your state that licenses CPAs (I think that CPAs have a certification that probably has some rules of ethics) and filing a complaint contesting the charge. FInd out exactly who that is and how it is done before you do anything.
If he is still nasty, do that. Send a concise letter and all documentation, including proof that you had not previously paid for his services yourself. I would mention the boastful threats he made word for word with a date and time if possible. THe more specific you are the better your chances.
I am not a lawyer or a CPA, but to me this seems like the way I would handle it.
Good luck, and remember, while he should have told you up front, caveat emptor. Above all be civil. I do think he will sue you and since most lawyers charge alot of money, it would cost you more. Plus, you might have to pay court costs. |
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THEHATMAN
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With 5.5 hours of work thats only $81.81 per hour. Sounds about right to me. Next time you sould use turbotax it easy to use and costs about $70. Yes he can sue you in small claims court and he will win. ut it wont cost you a dime because in small claims court you can not use a lawyer.
Check out my site for wholesale custom logo products.
http://escapesportif.com/ |
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dido45dido
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If he sues you it will only be able to go to small claims court and it doesn't matter if you have a lawyer there or not. and it won't cost anything to go to court.
If he takes you to court he will try to mail it to you which needs a signature and if you don't sign it is not legal yet. then he will try to have a person serve it to you and if you touch the document then you are surved if not then its not legal.
And once you go to court you plead your case and you have a 50/50 chance of winning |
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vze4h35z@verizon.net
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Maybe its just me but for 5.5 hrs of work to charge $450, hes trying to screw you.I wouldn't pay it.I'd take my chances in court if he sued me.I just buy a program to do my taxes, it much quicker and a hell of a lot cheaper. |
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Jen
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While that seems to be an exessive amount, even if you did not pay and were not sued... you would not be able to get copies of your tax return from the CPA.
So, if you needed to show your return for any reason( mortgage, refinance, credit, audit) you wouldn't be able to.
You should just pay him and take it as a hard lesson learned. Next year call around for some prices beforehand. We had our taxes done this year for $75 at a local accountants office and that was for self-employment filing. |
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Just Curious
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I would say just bite the bullet and pay the $450 to avoid paying more later. Also, more importantly, change who does your taxes. |
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tams
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I hope you saved that email...If you did then you need to go to the court house today and file in small claims court for illegal debt collection activity (find out what he can and can't do by reading the Fair Debt Collection Practices Act link below), report him to the BBB, and contact any one and everyone else you can think of...he was threatening you in an attempt to collect money...not only is that against the law, but it is against the code of ethics he must adhere to to be Certified...I would also suggest reporting him to the certification board in your state immediately. Good Luck and if you would like any help researching your case you can contact me...
By the way...it took me a total of 20 minutes to file my taxes this year. Not five hours. And I added a link to a CPA code of ethics site...you should be able to easily find a similar site for your state. |
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ebkelly74
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Although I can't say for certain since I don't know this person, $450 does not seem like enough for him to hire a lawyer to sue you. He will have to pay the lawyer plus a filing fee. He could also file a civil complaint on his own. If you choose to defend yourself, you'll also have to pay a filing fee for your response and spend a day in court arguing your case. If you do nothing to respond, a judgment will be entered against you. Either way, if he wins, you could be forced to pay the $450 plus court costs and have the judgment on your credit report. |
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