GREAT article and I 100% agree with all your points here. When I refer my clients to a Trust/Estate Attorney or to a Financial Advisor who I know will take good care of them, It is not with the expectation that I get anything in return other than more excellent service for my client. My clients truly understand that I am their Trusted Advisor. And my referral sources understand that I provide excellent service, so I am a safe place to refer THEIR clients. (applause, applause for this article!!)
Consider a bit of a wider issue. I referred a client to someone for a cost Segregation study. They did a great job and everyone was happy with the results. The client paid for the study directly and I incorporated it into the clients tax return. Then as a surprise to me, I get a email from the cost seg company that says I am due a referral fee. Do I tell the client and pass the fee on to the client?
GREAT article and I 100% agree with all your points here. When I refer my clients to a Trust/Estate Attorney or to a Financial Advisor who I know will take good care of them, It is not with the expectation that I get anything in return other than more excellent service for my client. My clients truly understand that I am their Trusted Advisor. And my referral sources understand that I provide excellent service, so I am a safe place to refer THEIR clients. (applause, applause for this article!!)
Consider a bit of a wider issue. I referred a client to someone for a cost Segregation study. They did a great job and everyone was happy with the results. The client paid for the study directly and I incorporated it into the clients tax return. Then as a surprise to me, I get a email from the cost seg company that says I am due a referral fee. Do I tell the client and pass the fee on to the client?
If you accept the money, and you are an EA or CPA, you need to disclose it at a minimum. You could also turn it down.
I agree with you 100% Tom!
May I suggest that next time you are asked what the referral fee will be, you answer a $25 gift card.
:-)