Is the Third Party Expense Reimbursable?

Answered by:

Question:

We have a third party who processes our daily incoming and outgoing cash letter, statements and stores the images for us. When we receive a summons we have to request the information from them. They charge a fee for this service and would like to be reimbursed by the requesting party. Is the third party expense reimbursable under IRS rules? If not, is there anyway we can charge the customer for this expense?

Answer:

I know of a few banks that have established a fee structure for responding to levies, attachments and other legal process. Assuming that customers are advised of the fees, and assuming that there is money sufficient in the account to satisfy the legal process (levy, etc.) those banks charge their own customer if they aren't able to recover from the serving party.

First published on BankersOnline.com 11/10/08