My CPA messed up my taxes which caused the IRS to do audits on 2006 & 2007 . I was fined with $ 4 , 500 in penalties .

It was my CPA's fault and I paid him over $ 600 to do the audit and I ended up spending a week in St . Paul , MN with IRS people making me find receipts for things my CPA claimed on my taxes that were not allowed . He will not reimburse me back for the penalties when it was his fault . Do I have a case if I take him to small claims ? I asked for reimbursement and he ignores me . Doesn't he have insurance for errors and omissions ?

Houlton, WI -

Attorney Answers (3)

Matthew Scott Berkus

Matthew Scott Berkus

Tax Lawyer - Denver, CO
Answered

You will need/want to make a claim against the CPA's error and omissions insurance (E&O Insurance). Since CPA's are regulated, you should be able to find the information with a little digging around.

However, when it comes to tax returns, it can be difficult to prove the CPA was at fault since the information that goes into the tax return is supplied by the taxpayer.

In any event, best of luck.

Linda Simmons Campbell

Linda Simmons Campbell

Tax Lawyer - Burlington, CT
Answered

You might also want to request a penalty abatement from the IRS. Sometimes the IRS is sympathetic when a taxpayer has relied on the expertise of an accountant and will grant a penalty abatement request.

lscampbell@cttaxhelp.com Office number: (860) 255-7423 Website: www.cttaxhelp.com. Our reply to your question... more
Bruce Givner

Bruce Givner

Tax Lawyer - Los Angeles, CA
Answered

Ms. Campbell and Mr. Berkus gave you excellent responses. In short, you may have a reason to go to Small Claims court. The CPA may have E&O coverage. However, proving fault is not easy.

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