03 / 09 / 18

RED FLAG: My Tax Preparer Designated My Tax Return as “Self-Prepared”

At Bryson Law Firm, LLC, we frequently represent Taxpayers through IRS Audits. One common issue we find when a Taxpayer comes in with an IRS Audit Letter and a copy of their 1040 Tax Return prepared by a paid preparer is that the tax return was incorrectly prepared, generated an inflated tax refund, and was designated as “self-prepared.”

Did you know that paid tax preparers are REQUIRED under Internal Revenue Code 6695(b) to identify themselves on the tax return in the “Paid Preparer Use Only” area and if they don’t, those preparers may be facing a penalty of $50 PER failure to sign with a maximum penalty of $25,500 per year? The IRS does this in an effort to hold tax preparers accountable for the work they perform.

In the end, you are legally responsible for all information on your tax return whether you hired a paid preparer or not, but in an effort to mitigate the potential for an erroneous tax filing, ensure your paid preparer signs your tax return.

Stay tuned for more RED FLAG Tax Preparer blog posts coming soon!