The IRS has made it mandatory for all U.S. citizens and Green Card holders to file their tax returns annually. You can file your taxes yourself using tax preparation services such as H&R Block or Liberty Tax. In essence, tax preparation services help people with less complex tax filing situations, especially those with W-2 income, students and first-time filers.
Always evaluate a tax preparation service’s credibility to avoid tax filing issues later. Reputable service providers are conversant with various tax codes and laws to guarantee maximum compliance with IRS tax laws. However, some tax preparation services make errors that create tax controversies with the IRS.
Errors made during filing of the tax returns
Tax preparation software and professionals can make errors while filing taxes. Because of this, you are encouraged to confirm all your details before submitting your tax returns to the IRS. Some of the common errors to look out for include:
- Incorrect social security numbers
- Incorrect names
- Wrong bank account numbers
- Mistakes determining your credits or deductions
If you discover a mistake on your tax return, you can file a complaint with your tax preparation service for compensation if you are entitled to a large refund. Some tax-preparation service providers account for their mistakes. However, if your claim is dismissed unjustifiably, you can sue in small claims court if the company owes you a significant refund.
Suing in small claims court
Suing a company in small claims court can be complicated. Your claim must meet a set threshold to stand trial, and you must follow a particular procedure to sue a tax preparation company:
- Confirm whether your claim qualifies for small claims court by checking the amount owed and the type of relief you seek
- Send your tax preparation company a demand letter asking them to settle the issue outside of court
- If the company fails to respond to your demand letter, fill out the court forms required to file your tax return complaint — ensure you have enough copies, as you will need them later in court
- File your complaint against the tax preparation company officially in small claims court
- Serve the tax preparation provider with your court forms — remember to state why you are suing the company
- Appear in court on the set date with all your court forms and evidence to present before a judge