Suing Tax Preparer

[Faith623]

What is the name of your state (only U.S. law)? Florida.
A few weeks ago I got a letter from the IRS stating that I owe them $1400 for my 2014 return. It may not seem like a lot but for a part time worker like myself it is a lot. As soon as I got the letter I called IRS and to my surprise my tax preparer sent a tax return that was completely different than the copy he gave me. He claimed credits I never told him about. Not only was the return different from mine but he inserted another routing and account number from mine. I gave him money to prepare my taxes and he took more and gave me the rest. I already sent IRS all the proof: 14157A & 14157 forms, letters, my copy of the return he gave me with my account info, bank statement saying how much I received compared to what they took, business cards, text messages regarding this, etc. Can I sue him in small claims court? Should I petition the Tax Court? Will they take my return from next year while I'm still waiting for the IRS or during my petition process (if I take that route)? If I have to pay it, can I pay monthly and still sue him?
He also did the same for my 2015 but that may fall on me since he actually put the number down and I just trusted him without paying attention although I did tell him I did not go to school that year. I just can't believe he would do that snake move. I will amend that tax return and pay the fees for that but I will also file a 14157A and 14157 forms because he inserted a different routing & account number and took more from my return on top of the cash I paid him and claimed something opposite of what I told him. Can he be held accountable for putting his own routing and banking info instead of mine and taking additional money?
Sorry for the questions, I am just trying to take the correct steps in this process.

 

[adjusterjack]

Yes, you can sue him in small claims court but not for the amount of additional tax because you would have owed that anyway.

The best you can hope for is part or all of the fees that he charged you plus any penalties and interest that resulted from his negligence.

I suggest that you sue for both years as the statute of limitations is two years from the date you discovered the issue and your 2014 return, having been filed in 2015, would still be within the two years.

See Florida statute 95.11(4)(a):

http://www.leg.state.fl.us/Statutes/index.cfm?App_mode=Display_Statute&URL=0000-0099/0095/Sections/0095.11.html

 

[LdiJ]

What is the name of your state (only U.S. law)? Florida.
A few weeks ago I got a letter from the IRS stating that I owe them $1400 for my 2014 return. It may not seem like a lot but for a part time worker like myself it is a lot. As soon as I got the letter I called IRS and to my surprise my tax preparer sent a tax return that was completely different than the copy he gave me. He claimed credits I never told him about. Not only was the return different from mine but he inserted another routing and account number from mine. I gave him money to prepare my taxes and he took more and gave me the rest. I already sent IRS all the proof: 14157A & 14157 forms, letters, my copy of the return he gave me with my account info, bank statement saying how much I received compared to what they took, business cards, text messages regarding this, etc. Can I sue him in small claims court? Should I petition the Tax Court? Will they take my return from next year while I'm still waiting for the IRS or during my petition process (if I take that route)? If I have to pay it, can I pay monthly and still sue him?
He also did the same for my 2015 but that may fall on me since he actually put the number down and I just trusted him without paying attention although I did tell him I did not go to school that year. I just can't believe he would do that snake move. I will amend that tax return and pay the fees for that but I will also file a 14157A and 14157 forms because he inserted a different routing & account number and took more from my return on top of the cash I paid him and claimed something opposite of what I told him. Can he be held accountable for putting his own routing and banking info instead of mine and taking additional money?
Sorry for the questions, I am just trying to take the correct steps in this process.

Ok, take a big deep breath for a minute. It does sound like your preparer did some wrong things on your return, but the wrong routing and account number may be a misunderstanding on your part. Did you pay for the return by having your fees come out of your refund? If so, that is why the different routing and account number. The way that works is that the bank that facilitates your fees coming out of your refund sets up a temporary account for you for the purpose of processing the refund only. They deduct your prep fees and the bank's fees, and then either issues you a check or direct deposits to your account, the rest.

However, if you are saying that you paid your fees up front, and there was still a different routing and account number on your return, then your preparer committed an actual crime, and needs to be prosecuted in federal court.

Ok, now back to the other issues. You really need to take your copy of the original return, whatever letters you got from the IRS, and whatever information you have that indicates that the preparer put things on your return that was filed, that were different than what was on your copy, and go get a consult with another tax professional. You want to look for a tax office that is open year round because they tend to have people more experienced with resolving problems with the IRS. Sometimes the IRS is actually wrong when they send out CP-2000 letters (which is the letter that you got). You need to get professional advice before you pay the IRS any additional money or attempt to sue someone. A tax professional won't charge you much for reviewing the returns and letters and giving you an opinion as to what is going on.

I do know that you do not want to sue the tax preparer unless you have consulted someone else. That can seriously backfire on you. Also, if you sue the tax preparer they will not be responsible for paying your additional tax, they will only be responsible for any penalties and interest you are charged, and possibly any money they collected from you, depending on how it all plays out.

 

[LdiJ]

One more thing....

Do not panic too much about owing the IRS 1400.00. They are really good about installment plans and will actually go out 72 months so you can really set up a pretty low payment without a big deal. The lowest I have seen them go is 35 dollars a month and based on the amount you owe, they would probably go that low for you if you do end up owing the money.