Can You Sue Your Tax Accountant. That the error was an inadvertent error may be a good reason for the irs resulting in the waiver of some or all of the penalty. Calculate the exact amount of damages that you suffered as a result of your accountant's malpractice.
If your accountant refuses to fix any errors or reimburse you for irs penalties, you may be able to sue your accountant for malpractice and claim those penalties as damages. That the error was an inadvertent error may be a good reason for the irs resulting in the waiver of some or all of the penalty. California’s comparative negligence jurisdiction, in a lawsuit, the client is usually in the best position to catch an.
Posted On Apr 3, 2014.
It may be possible to recoup irs fines and fees from your tax accountant. If your accountant intentionally misappropriated your funds, such as by theft or embezzlement, or deliberately misled you into an investment by misrepresenting its nature, you also may be able to sue him or her for fraud. I had a potential client call me who wanted to sue her prior tax preparer.
The Tax Preparer Clearly Made A Series Of Bone Head Mistakes (One Example Was Including A Schedule C On An 1120).
It is therefore important to have gathered as much evidence as possible to support your claim in case your matter sends up going to court. There are a number of potential negative consequences to your accountant providing you with bad advice or making mistakes on your accounts, most of which will cost you money. However, to avoid dealing with these problems, it is best to research the candidates.
Here Are Three Big Red Flags.
When you suspect the tax preparer of misconduct that results in an irs audit and penalties, you can report them to the irs for misconduct or sue for damages. California’s comparative negligence jurisdiction, in a lawsuit, the client is usually in the best position to catch an. Unfortunately, not every tax preparer will take that approach, especially when the dollar amount involved is.
What About The Penalties And Interest?
If your tax preparer makes a mistake resulting in you having to pay additional taxes, penalties or interest, you have to pay these fees — not your tax preparer. Additionally, an accountant may be held liable if they disregard their normal duty of care as an accounting professional. If the tax preparer made an error in one part of your tax return and the irs sanctioned you for an error on another part of the return, then the tax preparer's error did not cause you any damages, and you have no cause of action.
This Means That You’ll Have To Pay The Penalties, And You’ll Most Likely Need To Do So Before You Seek That Money From Your Accountant.
Although you should include both direct and indirect damages, such as interest, penalties, fines, or interruption of your business caused by irs seizure of your assets, you will not be able to claim damages that were not caused by your accountant's error (an. His or her breach of the duty owed to you is what caused your financial harm. The irs often will waive the penalties if a taxpayer provides a reasonable explanation for the error and asks that the penalties be waived.