A new client just left with their W-2s and I will be very surprised to see him back. I would not be surprised to see him at HRB or another tax firm getting the refund he had before he answered my question about other income. It seems that he had won money gambling.
We have three casinos within 15 miles of here. Since the competition is so high, I am starting to see a lot of W-2Gs for jackpots. So far this year, I have seen as many as all of last year. This potential client lost his W-2G for his win and normally it wouldn't be a problem to just add the amount they won as other income. But he is certain he already paid taxes on that money. While I can put the income on the return without a W-2G, I can't put the withholding on without documentation to back it up.
In explaining the problem and why he needs to find the W-2G, I gave him the information he needs to go to another tax preparer and lie and get a bigger refund. And it is not just clients with gambling wins. I see this with EIC and all qualifying child issues, business income and expenses, and RAL applications. In explaining to clients why they don't qualify for a benefit, we give them knowledge. 80% accept what they learn and file a correct return. But the other 20% take that knowledge and use the system to get the refund they believe they are entitled.
While I lost a client, I don't have to worry about filing a return I can't justify. And I did forget to mention one thing to him about that W-2G; the IRS's matching program. If he does try to cheat on that W-2G, he will be getting a "Oops" letter in a few months. Karma!