Your accountant made a mistake: what to do next

If your accountant or tax preparer made a mistake, deal first with any IRS or state deadline in front of you, then get your records back, ask the preparer in writing what happened, and have someone independent review the work. Penalty relief, complaints to regulators, and legal deadlines each run on their own track, so it helps to know which is which early.

This guide covers the first steps after you discover the problem. For what accounting malpractice is and who can bring a claim, see our accounting malpractice guide. Where rules come from state law, we use Florida and Arizona as examples. Rules differ from state to state.

Start with the deadline in front of you

You may first learn about an accountant’s mistake from a letter: a notice that a return was changed, that a balance is due, or that a return was never received. Whatever you decide to do about the accountant, that letter keeps its own clock.

The IRS says to review a notice carefully and keep it for your records, and “if we ask you to respond, act by the due date” (IRS, Understanding your IRS notice or letter). The same page says:

• If you disagree with the notice, follow its instructions to dispute it, and reply by the due date to protect your appeal rights.
• If you have an amount due, pay by the due date even if you can’t pay all of it, because that can reduce interest and penalty charges.
• If the IRS changed your return, compare the notice with your return. You only need to act if the IRS asks for more information, if you have a balance due, or if you disagree.

Practical steps for the first few days:

1. Write the response date from each notice on a calendar you’ll see.
2. Keep each notice with its envelope, in date order.
3. Don’t wait for your accountant to respond before you act on a notice. A disagreement with your accountant doesn’t pause an IRS or state deadline.
4. If a letter looks suspicious, or you can’t find it in the IRS notice search, the same IRS page lists a phone number to call.

State tax agencies send their own notices with their own dates. Treat them the same way.

Get your records, and ask what happened in writing

Ask for your records back

You’ll need your own documents to respond to notices and to have the work reviewed. For federal tax matters, a federal rule covers this. Attorneys, CPAs, enrolled agents, and others who practice before the IRS must, at a client’s request, “promptly return any and all records of the client” needed to comply with federal tax obligations (31 C.F.R. § 10.28(a)). A billing dispute generally doesn’t relieve them of that duty. Where state law lets a practitioner keep records during such a dispute, they still must return the records that have to be attached to your return and give you reasonable access to review and copy the rest.

The rule defines client records to include the documents you gave the practitioner and returns or schedules they prepared for you earlier if you need them for your current federal tax obligations, with some exceptions (§ 10.28(b)). An accountant’s own workpapers are treated differently, and states have their own rules on them. Our accounting malpractice guide explains the Florida and Arizona examples.

When you ask:

• Ask in writing, list what you want, and keep a copy with the date you sent it.
• Ask for a copy of each return exactly as it was filed, not only the copy you were given.
• Keep originals yourself and work from copies.

You can also get your own tax transcripts from the IRS, online or by mail, which show what the IRS has on file (IRS, Get your tax records and transcripts).

Ask the preparer to explain, in writing

A short, factual letter or email to the preparer can help you understand what happened. You might ask:

• What was filed, when, and how it was sent.
• What caused the change or notice, in their view.
• Whether they have already contacted the IRS or state agency about it.
• What they received from you, and when.

Keep the tone factual, keep a copy, and save every reply. Avoid signing any release, waiver, or agreement about the mistake before you understand what it covers. Consider speaking with an attorney first.

Get an independent second look

You don’t have to take the original preparer’s word for what went wrong, or for how to fix it. A different tax professional can review the return, the notices, and your records, and help you respond.

The IRS notes that paid preparers include CPAs, enrolled agents, attorneys, and others without a professional credential, and that anyone with a Preparer Tax Identification Number can prepare returns for pay. It keeps a directory of preparers who hold credentials it recognizes or a filing season program record (IRS, Choosing a tax professional). Which kind of professional fits your situation is your decision.

The IRS also lists other places to get help: you can authorize someone to contact the IRS for you, see if you qualify for a Low Income Taxpayer Clinic, or contact the Taxpayer Advocate Service, which it describes as “an independent organization within IRS,” if you can’t resolve a penalty on your own (IRS, Penalty relief).

Keep the second reviewer’s findings with your other records. If you later talk with an attorney, they may want to see them.

Ask about penalty relief

If the mistake led to IRS penalties, you can ask the IRS to reduce or remove some of them. The IRS lists first-time abate and administrative waiver, reasonable cause, and statutory exception as types of relief (IRS, Penalty relief). It says to follow the instructions in your notice, that some requests can be handled by phone, and that Form 843 is the written request if relief can’t be approved over the phone.

First-time abate

The IRS says first-time abate applies to taxpayers with three years of timely compliance history. You must contact the IRS to request it, but you don’t need to name it or provide supporting documents; the IRS reviews your account to see if you qualify (IRS, Administrative penalty relief). It covers penalties for failing to file, failing to pay, and failing to deposit.

Reasonable cause

The IRS decides reasonable cause “on a case-by-case basis” (IRS, Penalty relief for reasonable cause). Two points on that page matter when an accountant was involved:

• For filing or paying late, the IRS says reliance on a tax professional generally isn’t a valid reason: “You’re generally responsible for complying with tax law even if someone else handles your taxes.”
• For accuracy-related penalties, the IRS considers factors including the steps you took to get help from a tax advisor and, if you relied on one, whether you gave them all needed information and whether they were competent and experienced with the situation.

Keep copies of every relief request and every answer. Relief from the IRS doesn’t decide whether the preparer is responsible to you for anything that remains.

Reporting the preparer

You can report a preparer to the government separately from anything else you do. A report can lead to discipline or, in some cases, a correction to your IRS account. It isn’t a way to recover losses.

• The IRS takes reports of paid preparer fraud or misconduct on Form 14157, Return Preparer Complaint. It asks for “specific and credible information” and suggests having your return and related documents on hand. Individual filers whose preparer altered their tax data, misdirected a refund, or filed a return without their knowledge or consent can also ask the IRS to correct their account with Form 14157-A (IRS, Tax return preparer misconduct).
• Florida: CPAs are regulated through the Department of Business and Professional Regulation, whose Division of Certified Public Accounting supports the Board of Accountancy (Florida DBPR, Certified Public Accounting). The board may discipline a CPA for “negligence, incompetency, or misconduct, in the practice of public accounting” (Fla. Stat. § 473.323(1)(g)). The department takes complaints online and says it “cannot represent you in civil matters to recover fees paid or seek remedies for injuries” (Florida DBPR, File a complaint).
• Arizona: the Arizona State Board of Accountancy administers and enforces the state’s accountancy law (A.R.S. § 32-702). It may discipline a CPA for “dishonesty, fraud or gross or continuing negligence in the practice of accounting” (A.R.S. § 32-741(A)(4)).

In both state examples, the board regulates CPAs. If your preparer isn’t a CPA, ask the state which agency, if any, oversees them; the IRS complaint route covers paid preparers generally.

Keep track of legal deadlines too

Deadlines for bringing a professional malpractice claim are set by each state, and they differ in length and in when they start. Some run from when the mistake happened. Others run from when it was discovered.

In Florida, for example, an action for professional malpractice other than medical malpractice must be started within two years, with the period running “from the time the cause of action is discovered or should have been discovered with the exercise of due diligence.” The same provision adds that this limitation for professional malpractice “shall be limited to persons in privity with the professional” (Fla. Stat. § 95.11(5)(b)). Privity generally means a direct contractual relationship, such as the one between an accountant and the client who hired them.

Because the discovery date can matter, write down when and how you first learned of the problem, and keep the letter or email that told you. An attorney licensed in your state can tell you which deadline applies and when it started. Penalty relief requests and board complaints don’t stop that clock.

What you don’t need to work out yourself

• Whether it was malpractice. An error, a bad outcome, and malpractice aren’t the same thing. We never evaluate whether anyone has a claim. An attorney licensed in your state, usually working with an independent accountant, decides that.
• The order of every step. If you aren’t sure whether to amend a return or request relief before speaking with an attorney, ask the attorney. Keep meeting IRS deadlines in the meantime.
• Every document. Start with the notices and what you have, and keep adding to the file.

For problems with a return in particular, see tax preparation errors. Keep your records yourself; we never ask you to send them to us. To learn how our service will connect people with independent participating attorneys, see how it works.

What has changed since we first wrote about this

MalpracticeAttorneys.com first covered what to do when an accountant makes a costly mistake in 2015, in an earlier article on this site. That article is no longer online. Laws and rules have changed since then, and this guide was written new from current sources checked on September 26, 2026.

One change we verified: the IRS says first-time abate “is transitioning to a new relief called Automatic Exemption from Penalty (AEP), starting Summer 2026” (IRS, Administrative penalty relief). Under AEP, the IRS says that if you file or pay late but have timely filed and paid for the three prior years (or 12 consecutive quarters for quarterly filers), the failure to file, failure to pay, or failure to deposit penalty won’t be assessed, and you don’t need to contact the IRS. It begins with 2025 tax year returns and 2026 quarterly returns. You still owe any unpaid tax and interest, and any penalty AEP doesn’t cover.

Rules can keep changing. Confirm current law with an attorney licensed in your state.

Sources and corrections

We wrote this guide from the primary sources below and checked it against them on September 26, 2026.

• IRS, Understanding your IRS notice or letter: responding by the due date
• 31 C.F.R. § 10.28: return of client records
• IRS, Get your tax records and transcripts: transcripts
• IRS, Choosing a tax professional: types of preparers and the credentials directory
• IRS, Penalty relief: types of relief, Form 843, and where to get help
• IRS, Administrative penalty relief: first-time abate and Automatic Exemption from Penalty
• IRS, Penalty relief for reasonable cause: reliance on a tax professional and advisor factors
• IRS, Tax return preparer misconduct: Forms 14157 and 14157-A
• Florida DBPR, Certified Public Accounting: regulation of Florida CPAs
• Fla. Stat. § 473.323: grounds for CPA discipline in Florida
• Florida DBPR, File a complaint: complaints and what the department cannot do
• A.R.S. § 32-702: Arizona State Board of Accountancy
• A.R.S. § 32-741: grounds for CPA discipline in Arizona
• Fla. Stat. § 95.11(5)(b): Florida professional malpractice time limit and privity

We are not attorneys, and this guide is not legal advice. Laws change and differ from state to state. If anything here is out of date or wrong, email support@malpracticeattorneys.com with the page name, and we’ll review it and update the page.