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Mon 30 Jan, 2006 09:00 am
A friend of mine mentioned last night that she needed to get an accountant, as her small business as grown past the point where she can manage it.
When I said that even though you have an accountant, you still better check their figures and so forth, she said "yeah, last year I had a CPA do my taxes, and I ended up paying about $700 extra because she didn't get it in on time, even though I sent her all my stuff really early.
she also mentioned the cpa wouldn't return her calls, it was really hard to get to her.
I thought if your taxes were late because of the accountant, they had to pay any penalties.
If so, what can she do to get reimbursed for that?
Not from the IRS, of course. Responsibility goes to the taxpayer. Like lawyers, though, cpa's carry malpractice insurance, probably just for items like this. Anyway, it's between her and the cpa, who may well be a member of the AICPA, so she might have recourse there, as well.
Naturally, I wouldn't deal with a cpa, doctor, or lawyer that wouldn't answer or return phone calls.
naw, I wouldn't either.
is it true though that the accountant is liable for the penalties if it's their fault?
Chai- I don't know what the deal is legally. I do know, that H&R Block advertises that they will pay the penalties if they are wrong about something, but that may just be their policy.
I don't think so, chai. You're talking business taxes, not personal taxes and it's a different can of beans. The business owner is responsible for everything that goes in on behalf of the business. She can try to withhold payment from the CPA for lack of performance, but the tax liability is all hers.
I'm not sure why they didn't file for an extension. It's a simple form that defers the filing date until... August, I think. The taxes all have to be paid on time, but that should have been done quarterly anyway. The end of year business filing doesn't usually involve paying any money to the IRS. That's all done during the quarterly filing and the fourth quarter/year end report is due in January (guess what I'm doing today? :wink: )
It might depend on what kind of business we're talking about. I own an S-corp which might be different from a partnership or sole proprietorship.
yeah, I don't know the whole story either. This was more of a conversation in passing.
I just thought it was strange in general.
thanks all.
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