What is a cpa's liability

November 17, 2008 2:25 PM

What is a cpa's liability? More specifically, I hired a cpa to do my payroll and taxes. She mis-payed all of the tax payments and then told me the wrong due date for another tax payment and then I got hit with a penalty. So what is her liability in all of this?
posted by thebwit to Work & Money (6 answers total)

Your state probably has a licensing board for CPAs. In most states, that board has a mechanism to handle complaints against licensees - that would be the first step I would take.
posted by deadmessenger at 2:48 PM on November 17, 2008

Professional liability can vary depending on the laws of your state. The terms of your contract with the CPA also guide her liability, so if you have a contract, check that out first. What she promised to do limits her liability, in addition to any other provisions you may have agreed to (like, for example limiting liability to refunding of fees). Looking at what would be fair or equitable (rather than what would be permitted under your state's law) to make you whole might include the penalty, the costs associated with the mispayments, and any expenses you incurred to get everything straightened out, including your time. Perhaps if you request these items from her directly, you will get most of what you want.
posted by *s at 3:02 PM on November 17, 2008

And the reason you haven't already talked to a lawyer is what, exactly?
posted by toomuchpete at 3:23 PM on November 17, 2008

This is one for a qualified attorney. Contact one you know personally and ask them for the name of a lawyer specializing in this kind of work.
posted by Ironmouth at 5:41 PM on November 17, 2008

Before going forward, determine what you can document (letters, emails, voicemails, etc.) that corroborates your assertion of malpractice and/or negligence. Also, try to estimate your damages (e.g., penalties). You'll then have several options available: 1) requesting compensation from the accountant; 2) as deadmessenger recommends, filing a grievance with your state's licensing board; 3) filing suit in small claims court; or 4) securing an attorney and filing a civil action.

Here is an article about auditing/accounting malpractice and negligence that reveals probably more than you'll want to know about this subject.

But it addresses two important issues: in comparative negligence states, awards are reduced by the percentage of plaintiff's (your) fault; and in contributory negligence states, if plaintiff is at fault at all, no damages can be recovered.
posted by terranova at 5:53 PM on November 17, 2008

State board. Also, if this person's letterhead listed other organizations, check those websites and see if they have a complaints dept.
posted by Lesser Shrew at 6:00 PM on November 17, 2008