Non-cooperating client with several un-filed returns
Today we are dealing with a non-cooperating client who has not filed their tax returns for the last three years. They have income from a retirement fund, an annuity, and social security, but they have not retained any paperwork for amounts received. I asked the AI Search Engine [Perplexity](https://perplexity.ai) to help me with this situation. I am aware of the need for consent and authorization to access the client's financial information, but I wanted to see if I was missing anything.
Here is my first question to Perplexity:
I am a CPA. A client has not filed their tax returns for the last 3 years while having income from a retirement fund, an annuity and social security. They have not retained any paperwork for amounts received. How do I start collecting all their paperwork from agencies and financial institutions.
To which Perplexity responded:
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To collect the necessary paperwork for your client who has not filed tax returns for the last three years, follow these steps:
1. Request IRS Wage and Income Transcripts
- Start by requesting wage and income transcripts from the IRS. These transcripts provide information reported by employers and financial institutions, including Forms 1099-R (retirement distributions), SSA-1099 (Social Security benefits), and other relevant forms[1][2][7].
- You can access these transcripts online through the IRS website or request them by mail[7].
2. Obtain Retirement Fund Statements
- For distributions from pensions, annuities, or retirement plans, request Form 1099-R from the relevant financial institutions or retirement fund administrators. Most retirement plans issue these forms annually and make them available online or by mail[3][4][5].
- If the client received multiple types of retirement income, ensure you collect all variations of Form 1099-R (e.g., CSA 1099R, CSF 1099R)[3][5].
3. Retrieve Social Security Benefit Statements
- Access Form SSA-1099 for Social Security benefits through the client’s account on SSA.gov. This form is available for up to six years in the past[6][9].
4. Contact Annuity Providers
- If your client received income from an annuity, contact the annuity provider to request copies of past statements or Form 1099-R related to annuity distributions[3][4].
5. Reconstruct Missing Records
- If records are unavailable from agencies or institutions, reconstruct income and expenses using bank statements, credit card reports, or calendar entries for deductible expenses[1][7].
6. Verify Mailing Addresses
- Ensure all agencies and institutions have updated mailing addresses to avoid delays in receiving documents[4][8].
By systematically gathering these documents, you can help your client file their overdue tax returns accurately and resolve any potential tax liabilities.
Citations:
- [1] https://www.goldenappleagencyinc.com/blog/how-to-catch-up-on-unfiled-tax-returns
- [2] https://www.roberthalltaxes.com/news/how-to-resolve-unfiled-tax-returns-in-2025-a-step-by-step-guide/
- [3] https://turbotax.intuit.com/tax-tips/retirement/when-to-use-tax-form-1099-r-distributions-from-pensions-annuities-retirement-etc/L0g2CrvvL
- [4] https://www.opm.gov/support/retirement/how-to/get-your-1099-r-tax-form/
- [5] https://www.drs.wa.gov/irs/1099r/
- [6] https://www.ssa.gov/faqs/en/questions/KA-02501.html
- [7] https://www.cbsnews.com/news/unfiled-tax-returns-everything-to-know/
- [8] https://www.opm.gov/retirement-center/tax-information-for-annuitants/
- [9] https://www.youtube.com/watch?v=iWjEXRvoT2U
- [10] https://www.irs.gov/businesses/small-businesses-self-employed/filing-past-due-tax-returns
- [11] https://www.osc.ny.gov/retirement/retirees/taxes-and-your-pension
- [12] https://www.irs.gov/forms-pubs/about-publication-575
- [13] https://www.irs.gov/instructions/i1099r
- [14] https://www.ssa.gov/faqs/en/questions/KA-01723.html
- [15] https://ilsrs.illinois.gov/sers/resources/tax-information.html
- [16] https://www.aarp.org/social-security/faq/getting-copy-ssa-1099-tax-form/
- [17] https://www.lbstax.com/blog/steps-to-take-for-individuals-with-unfiled-tax-returns/
- [18] https://www.jacksonhewitt.com/tax-help/tax-tips-topics/back-taxes/how-to-file-back-taxes-without-records/
- [19] https://www.jacksonhewitt.com/tax-help/tax-tips-topics/unfiled-taxes/4-steps-to-take-if-you-have-unfiled-tax-returns/
- [20] https://www.jacksonhewitt.com/tax-tools/free-document-checklist/
- [21] https://www.usa.gov/help-filing-taxes
---
That is pretty standard advice I would have given myself. There are 21 citations here telling me that perplexity looked at all those sites to come up with their answer. I see several good resources there for me to continue my research if I wished to do so.
For now, I wanted to persist and find out what other options I may be overlooking.
Here is my next question to Perplexity
Is there any way to obtain that without the client's cooperation? They are unable to register on SSA and they don't have online accounts on their financial institution.
To which Perplexity responded:
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Obtaining financial documentation for a client without their cooperation presents challenges due to privacy laws and professional ethics. Here are steps you can take within legal and ethical boundaries:
1. Request IRS Transcripts
- Use Form 2848 (Power of Attorney) or Form 8821 (Tax Information Authorization) to gain authorization to request transcripts directly from the IRS. These transcripts include income details reported by third parties, such as retirement distributions (Form 1099-R) and Social Security benefits (Form SSA-1099)[3][6].
- Ensure you have a Centralized Authorization File (CAF) number to process these requests[6].
2. Contact Financial Institutions
- If the client has authorized you via a signed consent form (e.g., Form 7216), contact their retirement fund administrators, annuity providers, and banks directly to request copies of past statements or tax documents[5][7].
- Without explicit consent, you cannot legally access these records due to confidentiality rules under IRC Section 7216[1][5].
3. Social Security Administration
- If the client cannot register online, you may assist them in requesting their SSA-1099 by visiting a local Social Security office or contacting the SSA directly. Authorization via Form SSA-3288 may be required.
4. Legal and Ethical Considerations
- You must obtain written consent from the client before using or disclosing their tax information for purposes other than preparing their returns. Violating confidentiality rules can result in legal consequences[1][5].
- If the client is unable to cooperate due to incapacity, consult legal counsel regarding obtaining authorization through a legal representative or guardian.
Without proper authorization, your ability to collect these documents is limited by privacy laws and professional ethics.
Citations:
- [1] https://www.cpajournal.com/2019/11/05/the-confidentiality-of-a-clients-tax-return-information/
- [2] https://www.reddit.com/r/tax/comments/1c5gs2w/tax_preparer_filed_my_taxes_without_my_consent/
- [3] https://www.irs.gov/individuals/about-tax-transcripts
- [4] https://forms.cpai.com/pdfs/Request%20for%20Records%20-%20A%20Guide%20for%20CPA%20Firms%20Final.pdf
- [5] https://tax.thomsonreuters.com/blog/how-to-explain-the-7216-consent-form-to-your-clients/
- [6] https://help.taxdome.com/article/1101-irs-transcripts
- [7] https://www.cpai.com/Education-Resources/my-firm/Tax-Services/Third-Party-Verification-Letters
- [8] https://www.irs.gov/pub/irs-pdf/f4506t.pdf
- [9] https://www.reddit.com/r/legal/comments/1i4dsv6/can_a_cpa_refuse_to_send_my_tax_documents/
- [10] https://ttlc.intuit.com/community/taxes/discussion/i-have-a-question-don-t-understand-the-consent-do-we-need-to-sign-it-to-file-or-what/00/147734
---
Once again, standard advice! This time, Perplexity is almost nudging me to not go down the path of trying anything without explicit consent. For good reason I say!
I was satisfied at this point, but there was an additional question under "People also ask" that I wanted to try out. I asked:
Can I access my client's financial information through any legal means
To which I got some form names and method or two to work with my non-cooperative client and their legal representatives.
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As a CPA, you cannot legally access your client’s financial information without their explicit consent due to strict confidentiality and privacy laws. Here are the key legal considerations and potential pathways:
Legal Restrictions
1. IRC Section 7216: This law prohibits tax preparers from using or disclosing client information for any purpose other than preparing tax returns unless the client provides written consent. Violations can result in fines and imprisonment[1][2].
2. AICPA Code of Conduct: The AICPA requires CPAs to maintain client confidentiality unless the client consents to disclosure or an exception applies (e.g., legal obligations like subpoenas)[4][6].
3. GLBA (Gramm-Leach-Bliley Act): Prohibits disclosure of nonpublic personal information without the client’s opt-out or explicit consent[7].
Legal Ways to Access Client Information
1. Form 2848 (Power of Attorney):
- Obtain the client’s signature on Form 2848, which grants you authority to interact with the IRS on their behalf. This allows you to request transcripts, notices, and other tax-related information[3][5].
- Ensure the form specifies the tax years and types of matters you are authorized to handle.
2. Form 8821 (Tax Information Authorization):
- Use this form if you only need access to tax records without representing the client before the IRS.
3. Requesting Records from Financial Institutions:
- With written authorization from the client, contact their financial institutions or retirement fund administrators directly to request statements or Form 1099s.
4. Social Security Administration (SSA):
- If the client cannot register online, assist them in obtaining Form SSA-1099 by visiting a local SSA office with a signed Form SSA-3288 (Consent for Release of Information).
### **If the Client Cannot Cooperate**
If the client is incapacitated or otherwise unable to provide consent:
- Work with a legal representative or guardian who can authorize access.
- Consult legal counsel for guidance on obtaining court-appointed authorization if no guardian exists.
Without proper authorization, accessing your client’s financial information would violate federal laws and professional ethics.
Citations:
- [1] https://forms.cpai.com/pdfs/Request%20for%20Records%20-%20A%20Guide%20for%20CPA%20Firms%20Final.pdf
- [2] https://www.thetaxadviser.com/issues/2017/may/safeguarding-confidential-client-information/
- [3] https://turbotax.intuit.com/tax-tips/irs-tax-forms/what-is-form-2848-power-of-attorney-and-when-is-it-used/L1x5JGWzL
- [4] https://www.cpajournal.com/2019/11/05/the-confidentiality-of-a-clients-tax-return-information/
- [5] https://blog.taxact.com/guide-to-irs-form-2848-power-of-attorney/
- [6] http://archives.cpajournal.com/1995/SEP95/aud0995.htm
- [7] https://www.lowenstein.com/media/4730/privacy-principals-for-accountants-mh-and-ms-cpa-journal-0508.pdf
- [8] https://www.journalofaccountancy.com/issues/2013/feb/20126773.html
- [9] https://www.moneythumb.com/blog/how-successful-accountants-manage-client-information-safely-and-efficiently/
- [10] https://www.irs.gov/pub/irs-pdf/f2848.pdf
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Nothing major to see here! I expected this. I was hoping to get some more creative ideas from Perplexity, but it looks like we still need consent and that is a very good thing for my customers.