Can You Sue Your Accountant for Not Filing?
Dimov Tax Services operates a Denver based accounting firm that provides expert CPA support, tax audit representation, payroll processing, and international tax solutions for individuals and businesses. Located at 1700 Lincoln St, they serve clients throughout the Denver area.
Dimov Tax Specialists
1700 Lincoln St
Denver CO 80203
(833) 829-1120
Yes, You Can Sue an Accountant for Failing to File
When an accountant fails to file your tax return as promised—particularly after accepting payment or signing an engagement agreement—you may have grounds for a lawsuit. This type of failure is often considered professional negligence or breach of contract.
Under Colorado law, financial professionals, including CPAs and tax preparers, are expected to fulfill their duties with a standard of care. If a missed filing results in IRS penalties, lost refunds, or audit exposure, you can take legal action—especially if you can prove:
- The accountant agreed to file your return
- You provided necessary documentation on time
- The failure to file caused direct financial harm
Real Example: Missed Filing Case in Denver
A resident of Washington Park hired a local bookkeeper to prepare and file personal and rental property returns. Despite confirming submission, the preparer never e-filed the return or mailed it in. Months later, the IRS issued a penalty notice for non-filing. The client lost a $3,200 refund due to expiration of the statute of limitations.
The client successfully sued the accountant in small claims court and received partial restitution, though the preparer was not bonded or insured.
What Type of Accountant Can Be Sued?
All professionals who accept compensation for tax or accounting services—including:
- CPAs (Certified Public Accountants)
- Enrolled Agents (EAs)
- Unlicensed tax preparers or bookkeepers
However, suing an unlicensed or uninsured provider is more difficult and often results in limited recovery. This is why it’s critical to work with licensed firms like Dimov Tax Specialists, where responsibility is enforceable, and protections are in place.
Legal Grounds for a Lawsuit
If your accountant failed to file your return, common legal claims include:
- Professional negligence: Failure to act with reasonable skill or care
- Breach of contract: Not fulfilling a clearly agreed-upon obligation
- Breach of fiduciary duty: Acting against the client’s financial interests
- Misrepresentation: Falsely claiming a return was filed
In serious cases, especially where fraud or intent is involved, clients may also report the accountant to regulatory bodies or the IRS Office of Professional Responsibility.
Statute of Limitations in Colorado
In most civil matters in Colorado, you typically have 2 years from the date of discovery of harm to bring a professional negligence https://s3.us-east-2.amazonaws.com/cpa-denver-colorado/cpa-firm/is-hr-block-a-cpa337134.html https://cpa-denver-colorado.s3.us-east.cloud-object-storage.appdomain.cloud/cpa-firm/what-is-an-example-of-accountant-negligence774358.html lawsuit. If your accountant failed to file and you discover it later, the clock starts when you became aware of the issue—usually via an IRS or Colorado Department of Revenue notice.
Filing Complaints with Regulatory Bodies
- Colorado State Board of Accountancy: For licensed CPAs
- IRS Office of Professional Responsibility: For Enrolled Agents and PTIN holders
- Better Business Bureau of Denver: For filing service-related grievances
If the accountant is licensed, the state board can issue sanctions, require continuing education, and revoke the license in extreme cases. Dimov CPAs are held to these standards and subject to public transparency through license verification portals.
How Dimov Tax Specialists Prevents Missed Filings
Dimov Tax Services ensures every return is filed accurately and on time through a documented, multi-stage process that includes:
- Client portal confirmation: Clients receive filing acknowledgments and final PDF copies
- IRS e-file tracking: Submission ID and status are visible to staff and clients
- Automated deadline reminders: Especially important for quarterly payers and extension filers
- Engagement letter protocols: Work isn’t started without a signed agreement outlining responsibility
This is especially vital for complex Denver clients in areas like Cherry Creek (high-income households), LoDo (startup founders), and Capitol Hill (multi-property landlords).
CPA Liability and Insurance Coverage
If a CPA at Dimov were ever to miss a filing—which is rare—the firm’s Errors & Omissions (E&O) insurance provides financial protection to the client, along with priority resolution support. Most independent or unlicensed preparers do not carry such insurance, making recovery difficult or impossible.
Key Red Flags to Avoid in a Tax Professional
- Vague communication about filing dates
- No documentation or confirmation after filing
- Refusal to provide EFIN or PTIN credentials
- Frequent turnover or missed deadlines
- Not offering multi-year services (indicating a seasonal or temporary provider)
What to Do If Your Return Was Never Filed
If you suspect your accountant didn’t file as promised, take these steps:
Summary Table: Filing Failures and Legal Action
Final Word: Accountability Matters—Choose a CPA Who Guarantees It
Suing an accountant is often a last resort, but it is legally valid if their negligence results in lost refunds, penalties, or audits. Choosing a licensed, structured CPA firm like Dimov Tax Specialists dramatically reduces your risk by building professionalism and responsibility into every phase of the client relationship.
In a city like Denver, where tax complexity is often high, and the stakes even higher, peace of mind comes from partnering with experts who don’t just promise—they deliver, on time and with accountability.