TAX PREPARER SCREWED UP and a year later, I gotta pay the difference.?

Question

His help tells me, "He just stepped out” or they say" Call back at ** o'clock" or "He'll be back in 20 minutes".
I know the taxes due are my responsibility, but He's a PROFESSIONAL TAX PREPARER, and entered the WRONG GROSS INCOME amount when he E-filed my taxes.
His business is independent, not part of a bigger tax return business like HRblock or JacksonHewitt
First, I thought,'Well, shitapins, i gotta pay some money.'.
But he's avoiding me. I want to find out where the mistake is. Am I the only one liable for this error, or does he have to bear some responsibility too?
I've been trying him for about six months and no response.

Lotta good answers, Thanks folks.
Ya i know its my bill to pay, no question on that.
I was heavily medicated on that day. A friend drove me .
I gave the guy a 20$ tip for the great return i was getting.

Answer 1

In cases like this, you are generally responsible for the tax.

However, if you were charged interest and penalties due to your preparer's error, your preparer should cover that. They should also fix it (file the 1040X and calculate the exact amount owed) for free.

If the preparer keeps dodging your calls, a few things you can do:
1) Log a complaint with the Better Business Bureau.
2) You can complain to the IRS. They certify tax preparers, and have some teeth when dealing with them. Contact:

Internal Revenue Service
Office of Professional Responsibility
Attn: SE:OPR – Room 7238/IR
1111 Constitution Avenue, N.W.
Washington, DC 20224

3) Take 'em to court. If the penalties aren't huge, use small claims.

Answer 2

Well there are several answers to your question.

I am a Tax Professional also, and have been for twenty years.

There is a possibility that you can get part of the penalties abated (forgiven). This would be accomplished by filing an amended return accompanied by a letter explaining that you relied upon a professional to file your taxes.

However, this isn't a guarantee. You are legally responsible for any return you sign regardless of who prepares it. The IRS will not be able to abate the interest, in this case, only the penalties.

You are correct that you do owe the additional tax. However, every professional, worth the title, that I know about are willing to pay the penalties and interest for any mistakes they make.

I don't know how much money you are talking about or the amount of effort your willing to put into it. But, you have several options. The first is a law suit, that should get his attention. The second is if he is an E-File Provider he has certain rules that he has to abide by...and it seems he isn't doing this.

You might make one more call to his office and tell him that you are about to report him to IRS, this should get his attention too. And then it would be up to you if you actually report him or not. He can lose his ability to E-File.

I would suggest that you talk to a local professional that is either an Enrolled Agent or a CPA that specializes in tax matters. Most of the ones I know will give you a few minutes to look at what you have without any charge. However, if you want them to handle it for you there will be a fee.

Answer 3

You are solely liable for the error. Most professional preparers will cover the penalties and some will cover the interest (that's taxable income to you, by the way, so keep track of it!) but they are under no legal obligation to do so.

You signed off on the return attesting to its accuracy. Next time, verify the numbers before you do so.

If this is a CPA you can file a complaint with the State Board of Accountancy, mostly for the fact that he's not getting back to you more than anything.

Answer 4

Part yours, part his. It's his responsibility to prepare it correctly if you gave him all the tax information, but it's ultimately your responsibility to make sure that all the information is correct, since it's your tax return. As far as financial responsibility, the tax is your responsibility, since if he had the right numbers on the return in the first place you'd be paying the extra tax that you know have/had to pay. Interest, well, could be half you and half him, or could be all you, after all, you did have the use of the money for the tax that wasn't paid. For penalty, I would say that that would be his responsibility, if it was indeed his error that caused the tax return to be incorrect. If I had to I would go to his office and sit down in a chair and say that you aren't leaving until you speak with someone, preferrably the tax preparer.

Answer 5

oh, no ummh. He is liable, specially if he's not being honest with you. You have to report him to IRS. I've been a Tax specialist for many years and if, if I ever make a mistake, the best thing is to tough it out, talk to the client, see if we can salvage the situation, most of the time you can, you can ammend your return, I always talk to IRS and try to solve the problem but I have insurance to cover my mistakes up to 25k as a bakkup. But havent used it up to now, most people understand small mistakes or typos and so does IRS. Maybe send him a letter proposing a meeting that you want to find out where the mistake was and that how will he try to fix the problem. If he is a good tax preparer, he will do it for free and if still you dont get and answer, call another one to fix the problem. Talk to IRS, if you have to pay money, make payment arrrangements, by phone, fax, internet and then if you can fix your problem later the IRS will have to return that money provided you prove the change.

Answer 6

As far as the IRS is concerned, you're on your own. For finding the error, the IRS tells you what you didn't do right that they want you to pay.

For your tax preparer, your only option really is court (most likely small claims) to recover any penalties and interest charged by the IRS for the mistake. The extra amount due will still be your responsibility since you'd have had to pay it anyway.

Answer 7

You have to pay the tax that you would have paid last year if he had not screwed up or return the refund that you would not have received if he had not screwed up. His error was in your favor and you have no right to profit from it.

However, if there is a penalty being imposed, putting you into a worse position than you would be if he had not made a mistake, and you can prove that it is his fault, then he should pay it. The IRS will require you to pay them, but you might be able to sue him in small claims court for reimbursement, depending on the laws of your state. Again, you are reasonably entitled only to reimbursement for the penalty, not for the amount of the error itself.

Answer 8

Legally you are the one responsible for whatever additional amount is due. Most ethical preparers would cover any interest and penalties. The part that's the additional tax itself is your responsibility, since if he hadn't made the mistake, you'd have paid that in the first place.

I'd stop into his office rather than just calling, and end this silly game of tag.

Answer 9

As a professional tax preparer, he signed your return along with you. However, you are the person that the tax return belongs to and you are liable for any wrong data. You might be able to recover any losses against your tax guy in court if you can track him down. But you still need to pay that tax bill.

Good Luck

Answer 10

I'd be standing in his office demanding to see him and asking him what he intends to do about it. I would say the least he can do is cover some or all of your penalties. Why are you on the phone with this guy if he's avoiding you? Don't give him any more opportunties to avoid you. AND, pay the darned added tax before the penalties are more than what you originally owed. You're stalling, too. You need to focus on direct action.