After years of working with tax preparers through his law firm, Jason Carr has watched the same five mistakes trip up new preparers again and again. Every one of them is avoidable.

In this episode, Jason walks through the five that do the most damage:

• Skipping the signed engagement letter
• Preparing a return without seeing the source documents
• Promising a refund amount before the return is done
• Not recognizing when a situation is beyond your scope
• Treating tax prep as a four-month seasonal business

If you are building a tax practice and want to protect yourself, keep clients, and avoid the errors that sink new preparers, this episode is your checklist.

Key Takeaways

• Get a signed engagement letter every client, every year: It is your protection in a fee dispute or a disagreement over what you agreed to do. Without it, it is your word against the client's.
• Work from source documents, not from memory: Ask for W-2s, 1099s, receipts, and statements. The IRS Automated Underreporter program compares third-party income data to what was reported on the return, and a mismatch can generate a CP2000 notice proposing additional tax.1
• A CP2000 is not an audit, but it still lands on your client's desk: It is a computer-generated proposal to adjust income, payments, credits, or deductions based on a third-party data mismatch.1 Working from documented information reduces that risk.
• Never promise a refund amount before completing the return: Guessing creates an expectation you may not be able to meet and sets you alongside the tax mills that advertise guaranteed refunds.
• Know your scope: Unfiled returns across multiple years, IRS collection actions like liens and levies, audit notices, and potential criminal exposure call for a licensed professional with representation authority. Referring out protects the client and strengthens your practice.
• Build a year-round practice: Seasonal preparers restart from zero every January. Year-round practitioners compound through quarterly check-ins, added services, and consistent visibility.

Resources Mentioned

• MuseSpring: https://musespring.com
• Tax Business Blueprint Program: https://musespring.com
• The Law Office of Jason Carr, PLLC: https://carrtaxlaw.com