"The attorney can likely work out a deal with the IRS for payment of the tax debts in installments or an offer in compromise whereby the taxpayer pays less than the full amount of IRS taxes, penalties and interest due," he says. Put another way: Tax attorneys know tax law in ways that accountants do not.
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And if you forgot to send in a document, the IRS will usually reach out in writing to request it. If the issue is a small one, the best thing you can do is wait until the IRS has fully processed ...
Mar 21, 2021 · If your tax return or refund was affected by the error, you’ll also need to complete Form 14157-A ("Tax Return Preparer Fraud or Misconduct Affidavit"). If …
Feb 10, 2011 · When Your Income Tax Expert Lets You Down. It can come as a shock when you discover that the person you trusted to do your income taxes didn’t do a great job. You may feel anger, resentment, stress, and fear. After all, the IRS has a great deal of power: they can audit you, levy your bank accounts, and impose significant penalties – and you ...
Apr 17, 2015 · If you correctly owe additional tax because of a return preparer error, then that is what you owe. The damages caused by the preparer are only the additional penalty and interest you may have to pay, since you should have owed the tax anyway. You might ask the preparer to refund you the penalty and interest you paid, or the fee you paid him.
Daniel Kurt is an expert on retirement planning, insurance, home ownership, loan basics, and more. Daniel has 10+ years of experience reporting on investments and personal finance for outlets like RothIRA.com, AARP Bulletin, and Exceptional magazine, in addition to being the "Bank of Dad" column writer for Fatherly.com. He earned both his Bachelor of Science in business administration and his Master of Arts in communication from Marquette University.
Accountants, lawyers, and enrolled agents are highly qualified for the job of tax preparation. If you find an error in your taxes, file an amended return as soon as you can. If you suspect misconduct on the part of your preparer, file a complaint with the IRS. Yet some filers find that the professionals can make mistakes, too.
You will need another tax preparer who will be willing to testify that the first one committed errors that it should have avoided. If you owe taxes and the correct tax preparations show that you owe taxes, the first preparer may only be responsible for interest or penalties that could have been avoided.#N#Good luck.
Use someone else next time. The first company should reimburse you for any penalties and interest.
If you correctly owe additional tax because of a return preparer error, then that is what you owe. The damages caused by the preparer are only the additional penalty and interest you may have to pay, since you should have owed the tax anyway. You might ask the preparer to refund you the penalty and interest you paid, or the fee you paid him.
Maurie Backman is a personal finance writer who's passionate about educating others. Her goal is to make financial topics interesting (because they often aren't) and she believes that a healthy dose of sarcasm never hurt anyone.
Tax preparers are humans, too, which means that they're not immune to basic mistakes. (Besides, think about it: Some of these folks are absolutely inundated during tax season, and those 60- to 70-hour weeks area apt to catch up with them at some point.) On the other hand, your tax preparer isn't a mind reader, so if you neglected to provide that person with the right information or failed to hand over certain tax forms you received in the mail, then he or she can't be held responsible for an error-ridden return.
On the other hand, it could be that your preparer's mistake results in you overpaying your taxes. In that case, you have up to three years to file an amended tax return stating you're due a refund.
In other words, a miscalculated deduction is a legitimate error. An attempt to hide income, however, is a whole other story. If you're dealing with the latter and were completely unaware of what your preparer tried to do, you may want to notify the IRS as well as whatever professional organization that person is associated with, such as the American Institute of Certified Public Accountants or the National Association of Enrolled Agents.
For instance, if you make your business an S-corp, the business itself isn't actually taxed. You would report the income on your personal tax returns. Conversely, with a C-corp, the business is taxed. And if you make your business an LLC, you'll be protected from personal liability if somebody would want to sue your business.
But if you owe a significant amount of money, you might want to hire a tax attorney to help you work out a formalized agreement with the government , according to Brian Thompson, a certified public accountant and tax attorney in Chicago.