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Tax Preparer's Errors & Omission

Why would I need an E&O policy?

It's that time of year. Your clients wait until the last minute... and expect you to meet the IRS deadline. There aren't enough hours in the day. And when the pressure's on, it's easy to make mistakes.

Many of our customers are not aware that the Tax Preparer's Bond only guarantees protection for consumers, not the tax preparers themselves. That's where an E&O policy comes in.

More and more, tax preparers are finding they need the additional protection an E&O policy provides against legal action. Even in an unjustified case, the legal fees incurred simply to defend oneself can be staggering.

For example:

  • An insured mistakenly omitted Form-1099 interest income when preparing a tax return for a client. The claim was paid under the terms of the policy for reimbursement of the applicable IRS penalty of $2,015 assessed to the tax payer.
  • An insured was responsible for a client's quarterly sales tax return being filed late, thus causing the state to assess the client a penalty of over $3,599. The claim was paid under terms of the insured's policy.
  • An insured with our optional bookkeeping coverage made a bookkeeping error in calculating the beginning accounts receivable balance, which resulted in an understatement of gross receipt, which was incidentally carried through to the tax return. The IRS assessed a penalty. Under the terms of the optional bookkeeping coverage, the claim was settled for over $2,500.

Our Tax Preparer's Professional Liability Policy gives you the protection you need, when you need it most. You get the assurance of protection, and the peace of mind that comes from knowing you're covered. And we offer expanded limits and additional coverage options.

Tax Preparers' Policies:

  • Cover claims against you and your client up to the policy limit.
  • Protect you against errors and omissions.
  • Cover defense costs (subject to policy limitations).
  • Cover both your full-time and part-time employees, even if they only work during the tax season.
  • Include one year complimentary retroactive coverage with the option to buy a second year.
  • Offer the option for bookkeeping coverage to protect more than tax work.

Don't wait until it's too late to get the coverage you need.
Complete the application today!

Please Note: A $250.00 Single Loss and
$500.00 Annual Aggregate deductible applies.

This document provides only a brief summary of coverage and policy provisions and does not constitute a guarantee of any kind. All statements herein are subject to the provisions, exclusions, and conditions of the applicable policy. Coverages afforded are only those for which application is made and for which a premium charge is paid as indicated in the Declarations of policy.

IRS penalties against the insured are not covered. Also, this is a claims made policy.