TaxCoach Briefs:    December 3, 2009

Volume 4, Number 49

• Marketing Minute: My @#*&%$ Root Canal
• Member Testimonial of the Week
• Member Resource: Member Call-In With Dominique
• Did You Know: Interviewer's Guide

=====================================================
MARKETING MINUTE (EAL)
=====================================================

MY @#*&%$ ROOT CANAL

Thanksgiving has always been my favorite holiday, It's like Christmas, with out the hype. And I usually eat too much. That was the case this year, as I hosted one Thanksgiving dinner, attended another, and indulged myself with more than I've eaten in a long time.

Saturday morning, I noticed a pain in my jaw. I popped some ibuprofen and didn't think much of it, but grew more and more distressed as the pain got worse and worse. Monday after work I went to the nearest urgent care center, where the doctor referred me to my dentist.

Tuesday morning, I went in to see my family dentist. (Talk about lifetime client value - she bought the practice that used to treat my mother before I was born.) At one point, as she tortured me with sharp instruments that would make interrogators at Abu Ghraib gulp in disbelief, she told me I needed a root canal. Then a crown. Then some double-secret cleaning and further evaluation. She wrote me a prescription for "Vitamin V" (Vicodin), and called the endodontist to schedule me for Wednesday.

I didn't even think to ask how much it would all cost until after the "procedure" was scheduled. (For the record, $1,000 for the root canal, another $1,200 for a crown for my tooth, plus god-only-knows-how-much for a 2-hour "records" session to chart the rest of my teeth and head off future disasters.)

But do you know what? I didn't really care how much it costs. Seriously. I wasn't about to shop around. I wasn't willing to wait for the price to go down. I just wanted to know how much I should be ready to pay to stop the pain!

Keith and I have said before that you have two main ways to motivate prospects and clients to act. Pain. Or gain. Which of those two do you think is more effective?

The answer, of course, is pain. People will act faster and pay more to end an immediate and specific pain they they ever will for gain. In fact, behavioral economists have actually quantified it (at least for money, not teeth). People generally feel twice the emotional impact for a dollar of loss that they do for a dollar of gain.

You can tell your client "You can reorganize how you operate your business and save $6,000 per year in employment tax." That's appealing. Or you can tell her "the way you're operating your business is costing you $6,000 per year in employment taxes you just don't have to pay." That's painful -- and compelling! Which do you think will spur your client more effectively to set up an S-corporation?

I realize most of you wouldn't look at emergency root canal surgery as an opportunity to talk tax marketing. But this is such a great example of the "pain versus gain" tradeoff that I had to discuss it.

By the way, the root canal itself was easier than I thought it would be. Once the novocaine wore off, the toothache was almost entirely gone. I can even write off the bill under my Section 105 plan!

=====================================================
MEMBER TESTIMONIAL OF THE WEEK (KAV)
=====================================================

Hello Keith & Ed,

Please make me a Press Club member!

I was able to deliver a tax plan proposal with a $20,000 planning fee, to a client referred to me by one of my existing clients. His records were so bad he wasn't sure how much he was going to owe, but he knew it was going to be substantial. I had just met him and took Ed's advice and did NOT give him a tax savings amount or fee up front. I used TaxCoach tools and what I learned from the Certified Tax Coach training, and analyzed his situation. I was able to generate a proposal for him with a ROI in excess of 200% in the first year! I took a deep breath and hit send on the email. The next day I got a response saying I was his new CPA. The client is delighted, and I'm glad to have the resources available to generate these savings for him.

Thanks guys for all that you do.

Ed Lloyd, CPA
Charlotte, NC

Ed left one part out of his comments. He delivered the proposal just two weeks after he got home from his Certified Tax Coach™ training. That's a quick and impressive return on his CTC investment!

If you're considering enrolling in the program, there's still time to take advantage of the 2009 inaugural academy tuition discount (a $521 value) and complete the program to be listed in the searchable national database in time for the 2010 tax season. Ed and Dominiaque will be hosting a teleseminar next week (Wednesday, December 10, at 4PM EST) to discuss it.

To connect to the conference, dial (218) 862-1000, and enter participant access code 712276#.

No advance registration is necessary. So be sure to join us, Wednesday, December 10, at 4pm Eastern, to learn how Certified Tax Coach™ can change your business!

=====================================================
MEMBER RESOURCE (KAV)
=====================================================

MEMBER CALL-IN WITH ED AND KEITH

We had a "my dog ate my homework" kind of week. I'm out of town on a project, and as Ed discussed above, he developed a painful hole in his head that turned into emergency root canal surgery on Wednesday! Poor guy.

So at the 11th hour, we either had to abandon the call-in, with little time to tell everyone, or, wing it. Well, this round we were fortunate enough to have Dominique Molina, TaxCoach star member and now the Director of the AICTC for the Certified Tax Coach™ designation, fill in for us at the last minute. We stumbled through it a bit without Ed, but Dominique did a fantastic job of fielding questions and the call went really well (note the final comment in the list below!), and was attended just as heavily as ever. Thanks again, DM.

Ed and I will be back next week as usual. Here are some excerpts from the log of the questions raised by callers this week:

• I have discovered information about an "Electric vehicle mfg" that would essentially allow a business owner purchase a golf cart for $0 with the use of a credit from the American Recover act.... Any suggestions as to how to effectively market this knowledge to current client base??
• If a client with a side business (sched C) sets up a 105 plan can they deduct their medicare premiums through the MERP that they had withheld from SS benefits for both husband and wife?
• I was showing some of my marketing materials to a CPA friend of mine. I’ve been using the examples in the playbook to produce various letters and flyers etc. My friend remarked that some of the language sounds shady e.g. “Here’s how to beat the IRS!”. I happen to disagree since I’m trying to differentiate myself from other accountants. What are your thoughts on having effective marketing materials while at the same time keeping an air of professionalism?
• I have a C Corp client that just went thru audit. 2007 and I did not do that return. When coming to me I immediately recommended S Corp, they decided not to. Then the audit this year. Very bad ending, especially given the adjusted dividends to the personal return. Now, they want to be an S Corp. Do you think it is too aggressive to have the S Corp election dated back to 1-1-09? Given all the new Rev. Proc. I feel certain we can get it, but really wanted a reality check.
• Regarding hiring a spouse and setting up a MERP, any suggestions about how to determine the fair compensation and document that the amount (salary and/or medical reimbursement) is fair market value.
• I have 61 yr old ( new client) owes 44K in Fed income taxes for 2003, 04, 07, & 08. Penaltioes included in 44K iare about 9 to 10K . I was thinking of doing offer in compromise but he has 75 K in IRA and pension if not annuitized could be 150K . He has had medical problems and been out of work 7 years. Just started rael estate busiiness. Or I could just try to get 10K penalties abated
• In the descriptions of elite programs they seem to be oriented toward practices with an established base of clients. Where do you see the optimal participation level in your array pf programs for a new practice with only a few clients at this pint?
• DOES A BOAT QUALIFY AS A PERMANENT RESIDENCE FOR MORTGAGE INTEREST DEDUCTION AND 500K GAIN EXCLUSION ?
• If a taxpayer shuts down a losing C-corp how does he write off the loss?
• Somebody better tell Ed his job is in jeopardy. Dominique is doing a great job filling in for him!

If you're looking for pointers on tax strategies or profiting from TaxCoach too, join us for the next call, on December 9, at 1pm Eastern. Enter a question or just listen in on the repartee. Check the "Contact Us" button within TaxCoach for registration instructions.

Members occasionally ask if we can record and archive these calls. The answer is that we want to keep them as informal and uninhibited as possible. We’ve discussed specific tax-planning clients and cases, for example – but we don’t want to put ourselves on record as offering individual tax advice. We’ve also discussed outside tax software and marketing services (both good and not-so-good), and we don’t want to put ourselves on record with those comments either. Member Call-Ins are intended to be casual discussions among peers – and we don’t want recording them to threaten that chemistry.

Please note that while our elite members (All-Stars, Press Club, and Hall of Fame) can still schedule time directly with Ed as part of their coaching programs, we simply cannot answer marketing and tax-strategy questions via email or unscheduled calls. We'll have call-ins as many Wednesdays as we can, and we'll talk to you then.

=====================================================
DID YOU KNOW . . . (KAV)
=====================================================

INTERVIEWER'S GUIDE

. . . TaxCoach contains an Interviewer's Guide to help you with the Client Data Questionnaire? The Interviewer's Guide discusses each of the items on the client survey, and how TaxCoach uses that item in selecting strategies to recommend to clients. It also offers tips for making the most of this meeting with your client, and for finding the best tax-saving opportunities.

You'll find the Interviewer's Guide in the Playbook near the top.

=====================================================

We're happy to answer your questions on TaxCoach content or features. (Save marketing and tax strategy questions for Member Call-Ins.) For best response, email support@taxcoachsoftware.com. If we think the answer will be useful to all of our members, we'll publish it (anonymously) here in the 'Member Q & A' section of TaxCoach Briefs.

Regards,

TaxCoach Briefs Archives...
Certified Tax Coach
TaxCoach All-Stars
TaxCoach Press Club
TaxCoach Cost Segregation