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Paying for a tax preparer's mistake
Dear Tax Talk:
The Internal Revenue Service sent us a notice of an error on our
2000 tax return made by our tax preparer, who is licensed for this
type of work. Who should have to pay for this mistake. We owe the
IRS over $1,000.
Thank you,
Anita
Dear Anita:
Everybody makes mistakes, including your preparer and the IRS. I
suggest you provide the preparer the opportunity to review the notice
in case it is an IRS mistake.
If it's not, then I suggest you ask the preparer to
explain how the error or omission occurred. It wouldn't be fair
to hold him liable if he was not provided with the information.
While it is unfortunate to get hit with a notice a
year later when you thought you had paid all your taxes, unfortunately
the tax is your responsibility. If the return had been properly
prepared, you would have had to pay the amount of tax at that time
or your refund would have been accordingly reduced. Of course, again
this stinks because you thought you had already taken care of your
obligations.
The next thing the IRS will want is interest of from
6 percent to 8 percent per year. While maybe you don't have interest-bearing
accounts that pay this much interest, you did have the use of the
money and most courts would not hold your accountant liable for
this. But if he's a good accountant, he may offer to split some
of this with you.
If the omission was your accountant's fault, then
he should offer to pay the penalty or attempt to have it waived.
-- Posted: June 7, 2002
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