Tax season can always be stressful, but having a tax preparer should relieve some of that tension.
In theory, when you hire a tax preparer, once proving all the necessary documentation, your professional should prepare and file your return. However, there are always instances that raise the question of who is responsible. This blog will answer those lingering questions.
Although every story is unique on its own, the government and Internal Revenue Service have laws in place that clearly state who is ultimately responsible.
Situation 1: Failure to Provide Paperwork
If you fail to provide your necessary documentation, your tax preparer will not be able to file your taxes nor meet the deadline. This situation is fairly simple. You are responsible.
Situation 2: Providing Paperwork Late
If you fail to provide your necessary documentation in a timely fashion and you provide your paperwork after the date your tax preparer has requested, they may not be able to meet the deadline. This is why they like to plan ahead and set dates. Typically, this will be a situation where you may request an extension or your preparer will plan to file one for you. Hopefully this situation’s mistake won’t be made with the final extension deadline. Either way, you are responsible for not providing the documentation on time; you are responsible for your taxes.
Situation 3: Failure to Follow Up
If you provide all your necessary documentation in a timely fashion and do not follow up with your tax preparer, it is still your responsibility that they are filed on time.
Situation 4: Providing Paperwork and Following Up
If you provide all your necessary documentation in a timely fashion and follow up with your tax preparer, you are STILL responsible that your taxes be filed on time.
Conclusion: The tax payer holds the ultimate burden and responsibility to ensure their return is filed on time.
The responsibility ultimately lands on the tax payers and any penalties, interest, and fees associated with late filing still fall under the tax payer’s responsibility.
Situation 4 was the story of the case United States v Boyle. Relying on a tax preparer does not remove the responsibility from the tax payer (Boyle, 469 U.S. at 251).
The Journal of Accountancy summarizes this case, “In Boyle, the taxpayer claimed that his attorney failed to file his federal estate tax return by the prescribed due date, even though the taxpayer provided all the records the attorney requested to prepare the return and even sought periodic updates on the status of the return. In its opinion, the U.S. Supreme Court provided a ‘bright-line’ test that ‘failure to make a timely filing of a tax return is not excused by the taxpayer’s reliance on an agent, and such reliance is not ‘reasonable cause’ for a late filing under [Sec.] 6651(a)(1)’ (Boyle, 469 U.S. at 248, 252) .”
The Internal Revenue code clearly puts an “unambiguous, precisely defined duty” on the tax payer to file in a timely fashion.
The Internal Revenue Service explains that reliance on a tax professional is generally not a valid reason for failure to file or pay a tax on time. The IRS details, “You're generally responsible for complying with tax law even if someone else handles your taxes. You should know what your tax preparer files and get proof that your return or payment is sent on time.”
So, in a nut shell, although your tax preparer is hired to relieve some stress while filling your taxes, it is still your responsibility to ensure your taxes are filed on time.
Finding the right tax preparer for you will help you ease the burden of filing.
At V&R Associates, we strive to follow up multiple times, ensure all paperwork is received and all questions are answered to file on time. However, there’s only so much we can do without proper communication from the client’s side. This is why we stress, that although certain firms like ours strive to provide you excellent service, it’s ultimately your responsibility -and that’s the law.
Want to get in touch with one of our professionals today? Contact us and we will get connected shortly.