James Edward Maule, MauledAgain (October 9, 2020): When Tax Return Preparers Go Bad, Their Customers Can Pay the Price

James Edward Maule’s MauledAgain tax blog entry focuses on the importance of selecting a reliable tax return preparer. His article, “When Tax Return Preparers Go Bad, Their Customers Can Pay the Price,” includes the following commentary:

Now comes a report that drives home the danger to taxpayers whose returns are prepared by unscrupulous tax return preparers. In a sense, the headline is an attention-grabber: “Customers under IRS audit after local company prepared their tax returns; Clients promised ‘maximum’ tax refunds must now give money back to government.”

The tax preparation firm followed through on its promise of “maximum” tax refunds by entering erroneous information on their clients’ tax returns. I wonder, did the taxpayers look at their returns before allowing them to be filed? Did they see any entries that did not seem right? For example, did they see charitable contributions listed for amounts far in excess of what they knew they paid? Did they see names of dependents that they did not recognize? Part of me finds it difficult to be totally sympathetic with taxpayers who don’t look a the returns prepared for them, or who, if doing so, ignore what clearly is erroneous information. On the other hand, to the extent the erroneous information was buried in worksheets not filed with the return, it becomes a bit easier to sympathize with the taxpayer who, after having spend the refund, learns that there is now a debt payable to the IRS. That can’t be fun.

To see the full article, click: “When Tax Return Preparers Go Bad, Their Customers Can Pay the Price.”

Posted by Elise Kim, Managing Associate Editor, Wealth Strategies Journal.

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