I ask all of my tax clients to read and sign an Engagement Letter, which I will provide to you at your appointment or which can be downloaded here. The Engagement Letter spells out the terms of the professional agreement between the tax preparer (me) and the client (you).
This certainly isn’t a complete list, but my responsibilities as a tax preparer include:
- Preparing your income tax returns correctly, based on the information you provide to me. (This is really a shared responsibility; the instructions to the Form 1040 specifically state that “If you have someone prepare your return, you are still responsible for the correctness of the return.” I always give you the opportunity to review your tax returns before filing them.)
- Minimizing your federal and state tax bill (or maximizing your refund) by taking advantage of all legal deductions, credits, etc.
- Assisting you with compliance with federal, state, and local income tax regulations. Playing by the rules, in other words.
- Informing you if I become aware of any errors on any of your prior year tax returns prepared by a different tax preparer. I am not responsible for notifying the IRS or state tax agencies of any errors I find on prior year returns. (In fact, I am forbidden from notifying them without your consent, except as required by law.) If you request it, I can amend the prior year returns, or can advise you on any steps necessary to correct any errors that I find. However, final responsibility for correcting any errors remains with you.
Your responsibilities as a client and taxpayer include:
- Providing me with accurate information in a timely fashion. You must inform me of all income you have received during the year (whether or not it was reported to you on a tax form such as a W-2 or 1099), and you must provide me with accurate lists of relevant expenses, deductions, etc. If you do not provide me with all necessary information in time for me to complete and file your tax returns before the filing deadline, then you will be responsible for any penalties associated with late filing. (I will certainly file an extension for you if you request one.)
- Maintaining accurate records of all relevant tax information. This includes keeping copies of all tax forms, as well as any receipts that are related to deductions or expenses you have claimed on your tax return.
- Notifying me of any changes after your tax return is filed. For example, you may receive amended W-2, K-1s, or 1099s in the mail after your return has been filed, or a refund (from the vendor) of an amount you claimed as an expense or deduction. In these cases, your return may need to be amended, but there’s no way for me to know that if you don’t tell me!
- Complying with all federal, state, and local tax regulations. I am, of course, responsible for the accuracy of the information I provide to you and for completing your tax return accurately based on the information you provide to me. But final responsibility for compliance rests with you, in the sense that if you fail to provide me with accurate information, or if you do not notify me of all circumstances that affect your tax and financial situation, I can’t file an accurate tax return on your behalf.