Engagement Agreement For Tax Services

We look forward to providing you with tax return preparation services this year! The purpose of this letter is to specify the terms of our engagement and clarify the nature and extent of the services we will provide. This way, you know what to expect from us, and we can strive to deliver high-quality, seamless services.

What Services Are Covered under This Engagement?

Preparation of U.S. Federal and State Returns

With this letter, you are engaging us to prepare your U.S. and state income tax returns, with all required accompanying forms, statements, and schedules. We will do so with the information you furnish to us as described below. If you have taxable income or loss in a state or locality other than your resident state, we will prepare your nonresident state or locality returns, as well, for an additional cost.

What Is the Scope of This Engagement?

This engagement is limited to the professional services outlined above. We will not prepare any tax returns other than those identified above, without your verbal or written request, and our verbal or written consent to do so. We will prepare the above-referenced tax returns solely to assist you with your tax filing obligations with the IRS and applicable state and local tax authorities. Our services are not intended to benefit or influence any third party, including any entity or investment which may seek to evaluate your creditworthiness or financial strength.

What Are Your Responsibilities during the Tax Preparation Process?

Timely Information and Clarifications

You must provide all the information required for the preparation of complete and accurate returns. Our team is committed to getting your return done as efficiently as possible, but to do so, we need you to deliver all records and information in a timely manner. You are responsible for fully and accurately disclosing to us all relevant facts affecting your returns.

If, during the course of your return preparation, we determine additional information or clarifications are needed, we will let you know. You are responsible for providing such additional information so we can complete your returns by the required due date. Please note that lack of responses on your part directly effects the completion of your return on our part, and may result in your return being moved to extension status. You are solely responsible for any and all interest and penalties from the taxing agencies if we are forced to put you on extension.

You also have the final responsibility for the tax returns. Once you receive them, you should carefully review the returns (to determine that there are no omissions or misstatements) before signing the authorization form allowing us to submit them to the tax authorities on your behalf.

Additional Information Provided after the Fact

If you provide additional information after we have delivered your return, we will assess a minimum $200 fee to amend your return with the new information. (Fee is contingent on amount if missing information). If you provide such information close to a deadline, we may not be able to update your return by the deadline. In such a case, we may advise you to make payments before the deadline, to minimize interest and penalties, and we will update your returns as soon as we are able to do so.

What Are Our Responsibilities under This Engagement?

We will perform our services based on the information you have provided, taking into account applicable federal, state or local laws, regulations, and associated interpretations relative to the appropriate jurisdiction as of the date the services are provided.

We will not audit or otherwise verify the information you provide us; however, we may ask for additional clarification of some information. You should maintain the documentation necessary to support the data used in the preparation of your tax returns should you be required to produce them upon examination by the taxing authorities.

What Positions Do We Take When Tax Law Is Not Clear?

We will use our judgment to resolve questions in your favor where a tax law is unclear, provided we have a reasonable belief there is substantial authority for doing so.

If there are conflicting interpretations of the law, we will explain the possible positions that may be taken on your return. We will follow the position you request, provided it is consistent with our understanding of tax reference materials. Tax reference materials include but are not limited to, the Internal Revenue Code (IRC), tax regulations, Revenue Rulings, Revenue Procedures, Private Letter Rulings, court cases, and similar state and local guidance. If the IRS, state or local tax authorities later contest the position you select, additional tax, penalties, and interest may be assessed. We assume no liability, and you hereby release us from any liability, including but not limited to, additional tax, penalties, interest, and related professional fees.

How Do We Handle Extensions of Time to File Tax Returns?

Extensions of Time to File Tax Returns

It may become necessary to apply for an extension of the filing deadline if there are unresolved issues or delays in processing, or if we do not receive all the necessary information from you on a timely basis. Applying for an extension of time to file may extend the time available for a government agency to undertake an audit of your return or may extend the statute of limitations to file a legal action. All taxes owed are due by the original filing due date. Additionally, extensions may affect your liability for penalties and interest or compliance with governmental or other deadlines.

To the extent you wish to engage our firm to apply for extensions of time to file tax returns on your behalf, you must notify us of this request in writing. In some cases, your signature may be required on such applications prior to filing. Failure to timely request an extension of time to file can result in penalties for failure to file tax returns, which accrue from the original due date of the returns and can be substantial. 

Although we may assist you in the preparation of an extension to file your returns, you have sole responsibility for the filing of any extension, and you agree to hold our firm harmless from any consequences, including waived elections, where the extension is not timely filed.

We reserve the right to unilaterally file and place any client on extension if we determine that our firm will be unable to complete a true, accurate, and complete tax return by the filing deadline.

Penalties and Interest Charges

Federal, state, and local tax authorities impose various penalties and interest charges for non-compliance with tax laws and regulations, including failure to file extensions or returns, late filing of returns, and underpayment or late payment of taxes. You will be responsible for the payment of any additional tax, penalties, and interest charges imposed by tax authorities.

What Happens Once We Deliver Your Returns to You?

Returns will be e-filed at the end of the day once authorization forms and payment is received by you. You are also responsible for making any tax payments directly to the tax authorities by the required due dates by the required deadlines. 

What Are Our Fees for This Engagement? When and How Are They Charged?

Our fees are based on the complexity of your returns, the tax forms prepared, and the amount of time required at our standard billing rate. Some forms are subject to minimum fees. 

Invoices are due and payable on presentation. SmartTax Solutions will not file any tax returns until payment is received in full. Any late filing penalties and interest due to failure to submit payment are the sole responsibility of the you, the taxpayer.

Additional Legal Terms

Engagement Limitations

You agree to indemnify and hold us harmless from all claims arising from the use of the tax returns for any purpose other than complying with your tax filing obligations regardless of the nature of the claim, excepting claims arising from our gross negligence or intentional wrongful acts.

The services performed under this agreement do not include the provision of legal advice, and we make no representations regarding questions of legal interpretation. You should consult with your attorneys with respect to any legal matters or items that require legal interpretation, under federal, state or other type of law or regulation.

Limitation of Liability

Except to the extent finally determined to have resulted from the gross negligence or other intentional misconduct of SmartTax Solutions & Bookkeeping LLC, our liability to pay damages for any losses incurred by the client as a result of breach of conduct, negligence or other tort committed by SmartTax Solutions, is limited to the total amount of fees charged by SmartTax Solutions for the particular service provided under this agreement to which such claim relates.

Other Provisions

Neither party shall be liable to the other for any delay or failure to perform any of the services or obligations set forth in this agreement due to causes beyond its reasonable control.

This agreement shall be governed by and construed, interpreted and enforced in accordance with the laws of the State of Illinois, without giving effect to the provisions relating to conflict of laws.

Acceptance of Engagement Terms

We want to express our appreciation for this opportunity to serve you.

Very truly yours,

SmartTax Solutions & Bookkeeping, LLC