WASHINGTON – John Stern’s ears have been just as busy as his calculator this tax season.
The Eastern Shore accountant’s office has become a forum where disgruntled clients vent about bailouts and the economy.
“People are really just frustrated with what’s going on,” said Stern, a partner with Salisbury-based PKS & Co. “I’ve never had so many discussions with people about it.”
A palpable anger and increased signs of worry are two of the changes accountants report seeing this tax season as the country faces the April 15 filing deadline in the midst of an unrelenting stretch of bad economic news.
While some filers agonize over personal finances and mounting job losses, others seethe about federal spending, including the hundreds of billions in assistance provided to a financial sector blamed by many for the economy’s troubles.
Lisa Ingram, who owns an accounting business in Severn, said that anxiety about the economy is real.
More clients are inquiring first about cost before hiring her, Ingram said. Others are unable to pay their bill or request payment plans for having their returns done. The firm has also seen an increase in clients who have had mortgages modified or refinanced.
“People are just looking for all kinds of ways to cut expenses,” Ingram said. “It’s affected everybody.”
Increased costs for expenses like unemployment insurance have eroded her own bottom line, Ingram said. So has the lost revenue from the closure of several business clients.
But a spurt of new and returning customers has helped, Ingram said.
“More people tried to do their taxes but found out it wasn’t as simple as they thought,” she said.
More people are also paying a 10 percent tax penalty for withdrawals from their retirement accounts last year, said Robert Askey, managing partner for Askey, Askey & Associates in southern Maryland.
He is also handling more returns for people who agreed to become independent contractors and assumed the full burden for payroll taxes, which are normally split between employers and employees. The tax bill has caught some of them by surprise, Askey said.
“They’ve been talked into this situation of ‘You can deduct more expenses and it’s better for you,'” said Askey, whose firm has offices in Leonardtown and La Plata. “But it’s really not.”
Marianela del Pino-Rivera, owner of a Bowie-based accounting business, said clients waited longer to meet with her this year. One reason, she said, is that brokerage firms took longer to revise dividend statements.
“Almost to the middle of March, I had clients waiting for revised forms,” she said. “It could be because there were so many mergers.”
The delay means she is doing more work later in the tax season, del Pino-Rivera said. “And it probably means more extensions as well,” she said.
Like Ingram, del Pino-Rivera is seeing more customers with troubled mortgages. News about layoffs is also on the rise, she said.
“I am definitely seeing the impact on some families because of the economy,” she said.
Frustration is growing, Stern said.
“The attitude of the people toward the Congress and the government is really down,” he said. “More people are saying, ‘I’m not voting for any people running for reelection.'”