You place a lot of trust in the individuals who handle your financial issues. If your accountant prepares your taxes and then you get audited, you probably have questions. Sometimes, it’s clear that the audit is the result of an error or even a failure to file the proper paperwork. The mistakes an accountant makes could cost you thousands of dollars or even your freedom in some circumstances.
After all, the federal government isn’t known for being particularly forgiving of those who fail to pay tax debt. If you find yourself facing an audit and claims of underpaid taxes, it is possible that the accountant who prepared your taxes made a mistake that may actually be a form of professional negligence.
In that situation, you may be able to take legal action against the accountant and hold them responsible for the impact their negligence has had on your life. It could be possible to file a civil lawsuit for professional malpractice.
Accountants have a duty of diligence and accuracy to their clients
You hired an accountant because you want someone professional and capable to manage your financial issues, including your taxes. After all, the domestic tax code is incredibly complex. Having an experienced accountant review your finances and determine your financial obligation in federal taxes may seem like a safer decision than attempting to determine those figures on your own or using some kind of automated software.
In most situations, that would be an accurate assumption. An accountant has years of training that can help them accurately determine your tax liability. However, any professional can make a mistake, including an accountant.
It is even possible that an accountant could intentionally attempt to manipulate the figures in your benefit. They may assume that by limiting your tax liability, they do something to help you. In reality, those tricks and maneuvers could end up causing you legal issues.
You can hold an accountant responsible for professional neglect or default
An accountant assumes responsibility on behalf of their clients. There’s usually a complicated contract involved. Even in cases where no formal contract gets signed, there is a degree of trust implied, as well as a fiduciary duty to the clients.Clients trust their accountants with financial records and potentially their future. When an accountant either fails to adequately perform their job or neglects their duty to you in some way, you may be able to hold them legally and financially accountable for the consequences that the oversight or error has on your life.
From covering the cost of your tax attorney to the lost wages during your tax audit, there are many damages you could potentially seek from an accountant whose mistakes have led to serious financial woes, such as an IRS audit.