If I have a professional doing my taxes each year and I am now being audit on one of those years, am I responsibile and should I have to pay if there is a reimbursement problem or the accountant that prepared my taxes. And no, I did not provide any false information to my accountant.
2007-12-03 11:45:34 · 9 answers · asked by Sapphire 4 in Business & Finance ➔ Taxes ➔ Other - Taxes
It is amazing that I pay an accountant to do my taxes so that there won't be any mistakes, but yet, I am still responsible. The point and advantage in paying someone is why??
Yes, I am feeling very frustrated right now because legally, I cannot afford to fight the IRS.
2007-12-03 12:51:57 · update #1
You, as the taxpayer who signed the return, are SOLELY responsible for the accuracy of the return.
Many tax professionals will reimburse you any penalties levied due to their mistakes and some will also cover the interest though there is no legal obligation for them to do either. YOU will be responsible for the additional tax in all cases though on the theory that you owed it anyway and would have paid it had the return been properly prepared.
If your tax pro does reimburse the penalties and / or the interest, keep in mind that that is taxable income to you and you must claim it on your tax return on the Other Income line.
In a case of gross negligence AND if the tax preparer refuses to cover the penalties you MAY have basis for a lawsuit to recover those penalties and possibly a small amount for punitive damages. You'd have to prove negligence and that can be hard (and costly) to do so unless you're talking about a huge penalty it's probably not worth it.
2007-12-03 13:03:35 · answer #1 · answered by Bostonian In MO 7 · 1⤊ 0⤋
Just because you are being audited does not mean there is necessarily a problem. It is certainly possible that they might disallow some item if you can not verify it.
And to answer your question. Yes, you are responsible for the return.
Cheer up. I sat in an audit for 3 hours one time, and there was no problem. I did however have to run back home and get some documentation to prove an item on the return.
2007-12-03 12:01:05 · answer #2 · answered by Anonymous · 2⤊ 0⤋
You are responsible for your tax return unless the tax preparer reported something incorrectly. If this is the case the preparer should accompany you during the audit process. Otherwise, you are own.
2007-12-04 05:14:39 · answer #3 · answered by pporter 1 · 0⤊ 0⤋
In the end you are responsibily, but the IRS does take into account who actually prepared the form, if the accountant signed the form. They still will look 99% to you to prove everything on the tax form.
2007-12-03 11:51:03 · answer #4 · answered by ckm0917 2 · 0⤊ 0⤋
You are solely responsible legally. Many accountants will pay the penalties and interest if you owe any due to their mistake, but you are the one legally responsible for payment of not only the original tax, but also the penalties and interest.
2007-12-03 12:17:34 · answer #5 · answered by Judy 7 · 3⤊ 0⤋
Many professional accountants provide a sort of guarantee or insurance. HR block does. So it will depend on the accountant. It ultimately is your responsibility but if your accountant provides the service guarantee, the firm/he/she will pay for it.
2007-12-03 11:56:03 · answer #6 · answered by Scott M 4 · 1⤊ 0⤋
I believe that ultimately you are responsible. A good CPA will go with you to the audit to explain/discover what they did.
2007-12-03 11:48:51 · answer #7 · answered by Jammer 2 · 0⤊ 0⤋
You are the one who is principally responsible for income tax mistakes so yeah...
2007-12-04 16:27:26 · answer #8 · answered by Anonymous · 0⤊ 1⤋
you are responsible for your tax return
2007-12-03 11:48:36 · answer #9 · answered by deejayspop 6 · 0⤊ 0⤋