Engagement Letter, Terms & Conditions, and Privacy
BNC Tax & Accounting Services
We appreciate the opportunity to work with you. This letter is to specify and confirm the terms of our engagement with you and to clarify the nature and extent of the services we will provide. We cannot commence work on your taxes until a signed copy is received.
Services: We will prepare your federal and requested state/local income tax returns based solely on information provided in the attached Tax Organizer and via the tax documents you submit. We will not audit or otherwise verify the data you submit, although it may be necessary to ask you for clarification of some of the information. You represent that the information you are supplying to us is accurate and complete to the best of your knowledge and that you have disclosed to us all relevant facts affecting the returns. Your use of such forms will assist in keeping pertinent information from being overlooked.
Client Responsibilities: Please note that it is your responsibility to ensure that all information necessary to prepare your tax return is included in your tax package. You should retain all the original documents, canceled checks, and other data that form the basis of income and deductions. These may be necessary to prove the accuracy and completeness of the returns to a taxing authority.
In preparing your current year tax return(s), it may become necessary to review your prior year(s) tax return(s) (and related documentation) to complete an accurate tax return. Your acceptance below constitutes your agreement to allow us to refer to past years information (tax returns, permanent documents, etc.) as necessary. As the taxpayer, you have the final responsibility for the income tax return(s) and, therefore, you should review them carefully before you sign them.
Bartering Transactions, Charitable Contributions, Travel and Phone Expenses, and Business Usage of Autos: You should also know that IRS audit procedures will almost always include questions on bartering transactions and on deductions that require strict documentation such as charitable contributions, travel, and entertainment expenses and expenses for business usage of autos, computers, cell phones, and home office. In preparing your returns, we rely on your representations that we have been informed of these transactions and that you understand and have complied with the documentation requirements for your expenses and deductions. If you have questions about these issues, please contact us.
Out-of-State Purchases: Most states have increased their efforts in identifying out-of-state purchases (online or otherwise) in which there was no sales/use tax paid on purchases. If you have applicable non-taxed purchases in the reporting year, please make sure to bring this matter and totals to our attention so that we may incorporate this information on your return.
Foreign Financial Assets: If you own or have authority over a foreign financial account, including a bank account, brokerage account, mutual fund, trust, pension, or other types of financial accounts, you may be required to report the account(s) yearly to the IRS. If you fall into one of the below categories, or if you have any direct or indirect foreign interests, you may be required to file applicable IRS forms at the time your income tax return is due:
– You are an individual or entity with ownership of foreign financial assets and meet the specified criteria (Form 8938);
– You are an officer, director or shareholder with respect to certain foreign corporations (Form 5471);
– You are a foreign-owned U.S. corporation or foreign corporation engaged in a U.S. trade or business (Form 5472);
– You are a U.S. transferor of property to a foreign corporation (Form 926);
– You are a U.S. person with an interest in a foreign trust (Forms 3520 and 3520-A); or – You are a U.S. person with interests in a foreign partnership (Form 8865)
Under the Foreign Account Tax Compliance Act (FACTA), each United States person must file a Report of Foreign Bank and Financial Accounts (FBAR), if 1) the person has a financial interest in or signature authority over one or more accounts in a foreign country and 2) the aggregate value of all foreign financial accounts exceeds $10,000 USD at any time during the calendar year. The due date of the FinCEN (FBAR) is April 15. This form is NOT part of your income tax return. It must be filed independently from your individual personal tax return to a separate service center.
By way of your signature below, you hereby acknowledge that you agree to comply with these reporting requirements and that you will disclose the necessary information to our office to prepare supporting documentation accordingly.
Foreign Income: If you have derived income from a foreign country, we will use the foreign country income information, which you provide, to calculate any applicable federal or state foreign tax credit or other affected federal or state income tax items. However, you are responsible for meeting any foreign country income tax or other foreign country reporting requirements.
Method of Filing/Copies of Returns: Our firm will e-file your returns, as required by law, unless there is a reason they cannot be electronically filed. You and your spouse (if applicable) must review and sign the form(s) necessary before the tax return(s) can be transmitted. You will be provided with a complete copy of your tax return to review and approve prior to filing. You will be provided with a copy of the filed return and acknowledgment of e-filing once the return processes.
Revisions of Returns: Should a tax return require revision after completion through no fault of BNC Tax, revision fees will apply. Any tax return requiring revision due to a legitimate preparation error will be revised at no charge.
Errors, Misrepresentations, Fraud, Illegal Acts, Theft: Our engagement cannot be relied upon to disclose errors, irregularities, or illegal acts, including fraud and defalcations, which may exist. We may inform you of any such matters that come to our attention. We will perform those accounting and bookkeeping tasks as determined to be necessary for preparation of the income tax returns. These services will be invoiced in addition to tax return preparation fees at our customary rates.
Professional Judgment: We will use professional judgment in resolving questions where the tax law is unclear, or where there may be conflicts between the taxing authorities’ interpretations of the law and other supportable positions in accordance with IRS Circular 230 guidelines.
Standards: The Internal Revenue Code and regulations impose preparation and disclosure standards with non-compliance penalties on both the preparer of a tax return and on the taxpayer. Unless we have a reasonable belief that any tax position in your return will be sustained on its merits due to having substantial authority, a preparer penalty will be imposed on us unless that position has a reasonable basis and is adequately disclosed in the return. And, while we might be able to avoid a preparer penalty by adequately disclosing the return position, you might not have to disclose the position in order to avoid applicable taxpayer penalties. If we determine that we would be subject to a preparer penalty by delivering your return to you, you agree to either adequately disclose that position on your return or change the position to one that would not subject us to penalty. If you do not choose to change your position or adequately disclose so as to eliminate, in our sole opinion, our exposure to the preparer penalty, we, in our sole discretion and at any time, may withdraw from the engagement without completing or delivering tax returns to you. Such withdrawal will complete our engagement, and you will be obligated to compensate us for all time expended and to reimburse us for all out-of-pocket expenses through the date of our withdrawal.
Filing Deadline and Extensions: The original filing due dates for your 2020 income tax returns are April 15, 2021 for federal and state. It may become necessary to apply for an extension of the filing deadline if there are unresolved tax issues or delays in processing, or if we do not receive all of the necessary information from you on a timely basis. If you are unable to complete and return the tax organizer or provide us with other required documentation by March 25, 2021 to allow for the timely preparation of your tax returns, you must contact us in writing by that date and request that we apply for an extension of the filing deadline on your behalf. You agree that you are solely responsible for all consequences if you fail to contact us by that date. If an extension of time to file is required, any tax that may be due with this return must be paid with that extension. Any amounts not paid by the filing deadline are subject to interest and late payment penalties when those amounts are actually paid. You are responsible for making all required payments.
Filing Deadline for Taxpayers Living Abroad: You may qualify for an automatic extension of time to file to June 15th, 2021. This not NOT an extension of time to pay. If you need an additional extension to October 15th, 2021 we must file the extension no later than April 15th, 2021. You agree to notify BNC Tax in writing in request of your extension by April 10th, 2021.
Fees: Our fee for preparation of your tax returns will be based on forms required to be prepared and the complexity of the issues in preparing your return. Additional fees may be incurred for bookkeeping services if books are presented in a way that is not compatible with preparing your tax return. Consulting fees on an hourly basis may be incurred for requested consultations with you or with third parties. All invoices are due and payable upon presentation. To the extent permitted by state law, an interest charge may be added to all account not paid within thirty (30) days. If you have not received an estimate of the cost of preparing your return and would like one, please contact us. Estimates cannot be guaranteed but will be provided as accurately as possible based on the information you provide to us.
Termination of Services and Refunds: If BNC Tax begins preparing or completing your return and you then terminate the engagement, you will be invoiced and charged for work completed. BNC Tax does not provide tax preparation refunds in situations where returns have been prepared, signed by BNC’s tax preparer, and delivered to the client, regardless of whether the return has or has not been filed. Termination prior to filing will result in original documents being returned to the client and a copy being retained by BNC Tax.
Disclosure of Personal and Tax Information: BNC Tax makes all reasonable efforts to maintain the privacy of client personal and tax information. Should we receive any request for the disclosure of confidential information from any third party we will notify you. In the event we are required to respond to a subpoena, court order or other legal process for the production of documents and/or testimony relative to information we obtained and/or prepared during the course of this engagement, you agree to compensate us at our hourly rates, as set forth above, for the time we expend in connection with such response, and to reimburse us for all of our out-of-pocket costs incurred in that regard. Please be aware that there are no attorney-client privileges when working directly with Enrolled Agents or CPAs.
Examination of Returns: Your returns may be selected for examination or review by the taxing authorities. Any proposed adjustments by the examining agent are subject to certain rights of appeal. In the event of such government tax examination, we will be available upon request to assist you. If an examination occurs, we will represent you if you so desire; however, these additional services are not included in our fee for preparation of your returns and we will render additional invoices for the time and expenses incurred.
Paragraph Titles: The paragraph titles used in this agreement are for convenience of reference only and will not be considered in the interpretation or construction of any of the provisions thereof.
Receipt of Notices from Tax Authorities: Please forward by fax or e-mail any notice/letter received from any tax authority related to tax returns prepared by us. In preparing your returns, we are not responsible for a taxing authority’s assessment of underpayment penalties or interest where this action results from erroneous, incomplete, inaccurate, or misrepresented information provided by you to us. If the foregoing correctly states your understanding, please sign and return the enclosed copy of this letter in the space indicated and return it with your client tax organizer and your supporting tax documentation to our office.
We recognize that you may be concerned about our use and disclosure of your personal information. Your privacy is very important to us, and the following will inform you of the information that we, BNC Tax & Accounting, may collect from you, and how it is used. By engaging in our services, you are accepting the practices described in this policy.
All information you provide to this firm is handled with care and confidentiality. Your personal information will only be shared with members of our firm who need to know this information in order to complete the work you have hired our firm to do. Other than the IRS permitted disclosure to a tax return processor for the purpose of preparing and e-filing your tax return, this firm will not disclose your personal information to anyone outside our firm without your express written permission to do so, or unless the firm is legally required or permitted to do so. If you communicate with us via our website contact form, chat on Facebook, email, or any other platform, we may collect the information you submit to us in order to contact you and serve you as a client. We will never sell or provide your personal information to any third party for advertising use.
CLIENT PRIVILEGED COMMUNICATIONS
Discussions with your tax advisor are confidential but not protected from the IRS. We may only provide privileged communication as it related to non-criminal tax advice or non-criminal court proceedings. If the nature of any subject matter to be discussed requires protected communications, please consult with an attorney for legal advice.
Our firm uses several layers of security to protect your data. Sensitive data is encrypted and transmitted using secure portals. You should verify your data is being sent securely by using our secure document upload tool. You can also check to see if the webpage you are using has a closed lock icon in the address bar. Your data is also protected once it is received by our firm and stored in industry standard cloud storage. Ultimately, you are solely responsible for maintaining the secrecy of your personal information. Please be careful and responsible whenever you are online.
DATA COLLECTION AND USE / GDPR
RECORD RETENTION POLICY
In accordance with our firm’s current record retention policy, we will retain our work papers and copies of your financial reports and other records for the engagement for four years. We will provide you electronica copies of all reports prepared that should be a part of your books and records. All of your original records will be returned to you. After four years, our records pertaining to this engagement will no longer be available. Physical deterioration or catastrophic events may shorten the term during which our records will be available. The working papers and files of our firm are not a substitute for your original records. It is agreed and understood that in connection with the performance of our engagement, the work papers prepared by us will remain our property.
We want to express our appreciation for this opportunity to work with you. The Entire Team at BNC Tax & Accounting
If you would like a copy of this form to be sent to you for your records, please contact our office.