What Is My Recourse if a Tax Preparer Failed to File My Taxes?

Taxpayers who have been victimized by tax preparers, such as those who haven't filed the returns or who have fraudulently amended returns, have the option of filing a formal complaint against the preparer as well as having any penalties, which resulted from the preparer's negligence, removed. If you've been left high and dry by your tax preparer, several options are available for filing a complaint.

Beware of tax preparers who over-promise or base their fee schedule on your refund. Avoid tax preparers who do not request to see your receipts or other authenticating documents related to your income tax return. Investigate your tax preparer through the Better Business Bureau, the state board of accountability for CPAs, or the Office of Professional Responsibility (OPR) for enrolled agents. Also, determine if your preparer is a member of any professional organization which requires him to pursue continuing tax education.

The Internal Revenue Service maintains a searchable "Directory of Federal Tax Return Preparers with Credentials and Select Qualifications." This is intended to help taxpayers with their decision making by providing a listing of preparers in their area who have a track record of filing successful tax returns.

If your tax preparer is an enrolled agent, then you can report him to the Office of Professional Responsibility. Include in your complaint the name, address, telephone number and other contact details of your tax preparer as well as a detailed account of the misconduct.

For example, if your preparer failed to file your taxes, provide details regarding when you paid the preparer to file the taxes, what you were told by your preparer, as well as any promises that were made. Also, include any penalties or interest amounts you were charged as a result of the preparer’s negligence.

Penalties and interest are assessed on unpaid tax when a return is filed late or the tax owed is paid late. Thus, if your tax preparer fails to file your return and you end up filing late, you will be penalized. However, it may be possible to have your penalties removed from your tax bill if you can demonstrate that you took the necessary steps to file a timely return and that the return was late of no fault of your own.

To do so, complete IRS Form 843 and mail it to the IRS. In the explanations section, include a detailed explanation of the circumstances that caused your return to be late. It may be a good idea to just attach a copy of the letter you mailed to OPR to your Form 843.

If you have evidence that your tax preparer may have been involved in fraud, then you should complete IRS Form 14157 and mail it to the IRS. On the form, list as much information about your preparer as you know, such as the preparer’s name, address and phone number. Also, include a detailed account of the fraud you observed.