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#2529 07/12/01 09:34 PM
Joined: Nov 2000
Posts: 2,236
Likes: 1
Member
Tom,

I'm not the one having trouble, but I'll keep your advice in mind when the time comes.

Steve, (sparky) was the one wanting to know.

My only slow payers was the local cellphone CEO, and was the secretary only doing pay outs once a month. I've never had a cu$tomer refuse payment for more than 30 days. Guess I'm spoiled there, one local sparky has waited several months for the city gov't to pay him about $25K ... I've heard that churches are often slow to pay...
Don't want to stereotype though...

I had big credit trouble with another business several years ago... A whole 'nuther story though...


-Virgil
Residential/Commercial Inspector
5 Star Inspections
Member IAEI
#2530 07/14/01 04:55 AM
Joined: Oct 2000
Posts: 5,392
S
sparky Offline OP
Member
http://forum.freeadvice.com/

A resource here for this threads concerns

[Linked Image]

#2531 07/17/01 06:54 PM
Joined: Oct 2000
Posts: 5,392
S
sparky Offline OP
Member

#2532 07/18/01 08:54 AM
Joined: Feb 2001
Posts: 62
M
Member
How about 50% down before you start the service change. Then, don't request an inspection until you receive the remaining 50%. Or, don't connect the service drop until you receive the remaining 50%.

#2533 07/21/01 01:28 PM
Joined: Jul 2001
Posts: 1
J
Junior Member
First you work for your money....Then you beg for it!!!

(anyone think about not paying a mechanic when he's done w/ your truck - maybe he'll give you 60-90 days?)

BTW - Nice forum

#2534 07/21/01 05:05 PM
Joined: Jun 2001
Posts: 29
R
Member
Back when we used to do residential additions often. Every once in a while I would run into someone that had the nerve enough to tell me that I charged too much.

After a short conversation explaining how much more the value of the property would be compared to the cost of the work, they usually relented.

Although to this day I don't really know the actual difference in value. [Linked Image] They know less than me so, I just want my money, I know I don't really charge enough for the job value anyway. But you can't please everyone, but you have to stick up for yourself.

#2535 07/22/01 09:52 AM
Joined: Oct 2000
Posts: 5,392
S
sparky Offline OP
Member
but you have to stick up for yourself.

that bears repeating resistor...

I had to be the bad guy last week...a certain biz in town....i waited until it was full of customers and employee's to stomp on in, ( a pix of my staring kids in hand) [Linked Image]

I slapped my overdue bill on the receptionist's desk and asked for the owner
who's mother was a hampster, and father smelt of elderberry!
I had previously mailed, and called many times, the last time i called i asked if i had to "make a scene" to get paid...
He saw me from afar, ran the other way, and told the secretary to pay me off....

Public humiliation can be a powerful asset, i had planned to at least get the local PD down...and word get's around quick in a small town.

I think he saw that gleen in my eye, oh well, i live to run away and be obnoxious another day.
[Linked Image]

#2536 07/22/01 10:24 AM
Joined: Nov 2000
Posts: 2,236
Likes: 1
Member
Glad to see you finally got paid...

I've got a customer now who's just the opposite... Can't wait for her bill... Doesn't like to owe anybody... They paid $80 cash "deposit" before they'd let me leave! My kind of customer...


-Virgil
Residential/Commercial Inspector
5 Star Inspections
Member IAEI
#2537 07/25/01 07:31 AM
Joined: Jul 2001
Posts: 21
B
Member
Sparky,
Invoice Frequently

Your contract should allow for frequent progress payments.

Frequent invoicing does several things: First, it helps your cash flow. Secondly, it allows the customer to understand that work has been done. Therefore, the customer may not have the opportunity to later say, "I didn't know that you had done this." Payment by the owner would be a means of proving acceptance of the work paid for. Further, if there is going to be a dispute, you are better off having the breakdown occur early. If you are going to have problems collecting your money, it would be better that you are owed a little rather than a lot.

Good luck!
Beth
Remote Office Solutions

[This message has been edited by bmaugeri (edited 07-25-2001).]

#2538 07/25/01 11:41 AM
Joined: Jul 2001
Posts: 21
B
Member
Let’s look at this collection tactic in its entirety with a step-by-step on how to employ it.

The concept behind a 1099 form is to report the miscellaneous payments to outside non-corporate vendors for non-merchandise related services in excess of $600 in a tax year. We hear some contractors claim that you can send a 1099 form to debtors because they received a service without paying for it, therefore it is income that must be reported.

The problem with this is it’s utterly false and doesn’t comply with the IRS rules. But when it comes to collecting monies owed by professional debtors, sometimes it’s the sizzle more than the substance. But a word of caution; check with legal counsel familiar with IRS rules before you go filing a 1099 form as a collection tactic.

With that caveat aside, here’s how to employ the technique if counsel give you a green light:

Start by sending a demand letter to your debtor. You can get an example of a quite heavy handed collection demand letter within this Forum.

If this demand letter fails, send a copy of a 1099 form listing the clients name along with a second letter:

"Dear Deadbeat Debtor,

As you recall, we sent you a demand letter dated XXX which has gone ignored. Because you have contracted and enjoyed the benefits of our services but have not paid for them, this potentially constitutes income subject to income reporting and taxation.

Enclosed please find a copy of the 1099 form. Unless you decide to provide us with your social security number which is your “recipient ID”, we will send the enclosed 1099 with the notation” taxpayer refused to give their S.S.N.

This form will be sent to the IRS and unless you reported the income, this may red flag your returns and trigger an audit.

"Enclosed find a letter to the IRS we will send along with the 1099. A copy of this letter will be cc’ed to the local IRS enforcement office.

If we receive funds in full per the lawful contract you entered into within the next 10 days, we will cancel the 1099 form and letter."


Now below is the letter you can enclose with the 1099 form:

"To Whom It May Concern,

Enclosed please find a 1099 form on Mr./Mrs. Deadbeat Debtor. We were unable to obtain from this taxpayer their social security identification number as they refused to provide it, but the taxpayers address and name are correct.

The income reported represents the value of the services we rendered that they refused to pay for, hence we are reporting this as income to the taxpayer under the miscellaneous rule.

Please verify with the taxpayers returns to ensure that they haven’t hidden this income from your agency.

Thank you.

Billy Bad-Ass, President
Take No Prisoners Plumbing

( Another One for you)
Beth
Remote Office
(am I through with the Hazing yet???)

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