Dear Client:

We look forward to providing you with tax return preparation services this year! The purpose of this letter and attached “Additional Engagement Terms” is to specify the terms of our engagement and clarify the nature and extent of the services we will provide. This way, you know what to expect from us, and we can endeavor to delight you with high-quality, seamless services.

We strive to make our tax return process as straightforward and convenient as possible for you. Our goal is to minimize any hassle on your end while also making things as efficient as possible on our end. This allows us to deliver your returns expediently, while also bringing to bear a high level of technical expertise and personal service. It also helps us keep our costs down for all clients.

Returns Covered under the Engagement

With this letter, you are engaging us to prepare your 2020 U.S. and state fiduciary income tax returns. We will do so with the information you furnish to us in the process described below. If you have taxable income or loss in a state or locality other than your resident state, please let us know, and we would be pleased to prepare the required nonresident state tax return(s). In addition, you may have a filing requirement or tax liability in a foreign country. Generally, you are responsible to determine whether you must file and pay taxes in a foreign country; however, upon request, we would be pleased to assist you in making these determinations. We will not prepare any tax returns other than those identified above, without your written request, and our written consent to do so.

We will prepare the above-referenced tax returns solely for filing with the Internal Revenue Service (“IRS”) and applicable state and local tax authorities. Our work is not intended to benefit or influence any third party, either to obtain credit or for any other purpose.

You agree to indemnify and hold us harmless with respect to any and all claims arising from the use of the tax returns for any purpose other than filing with the IRS, state and local tax authorities regardless of the nature of the claim, including the negligence of any party.

This engagement is limited to the professional services outlined above.

Information Gathering and Submittal Process

You are responsible for fully and accurately disclosing to us all relevant facts affecting your returns. To help you assemble the information needed for your returns, we will provide you with a questionnaire, organizer, and/or other document requesting specific information. Once your information is assembled and organizers/questionnaires are complete, you will submit your complete information to us. Please know that failure to provide information via completed questionnaires and organizers may require an extraordinary effort on our part, which may be reflected in our fee for service.

We will not audit or otherwise verify the information you provide us; however, we may ask for additional clarification of some information. You should maintain the documentation necessary to support the data used in the preparation of your tax returns should you be required to produce them upon examination by the taxing authorities.

Client Due Diligence

We will provide you with guidance on the timeline for submitting your tax information to us. It is your responsibility to provide your complete tax information to us in a timely manner so that we can prepare your tax returns in time for you to file them by the due dates. You also have the final responsibility for the tax returns, and therefore, once you receive them, you should carefully review the returns (to determine that there are no omissions or misstatements) before signing them and submitting them to the tax authorities, or authorizing e-filing of the returns.

Tax Planning Services

Tax planning services are not within the scope of this engagement. During the course of preparing the tax returns identified above, we may bring to your attention potential tax savings strategies for you to consider as a possible means of reducing your taxes in subsequent tax years. However, we have no responsibility to do so, and will take no action with respect to such recommendations, as the responsibility for implementation remains with you, the taxpayer. If you ask us to provide tax planning services, and we agree to provide them to you, we will confirm this engagement in a separate Agreement.

Tax Advice

Any advice we may provide is based upon tax reference materials, facts, assumptions, and representations that are subject to change. We will not update our advice after the conclusion of the engagement for subsequent legislative or administrative changes or future judicial interpretations. To the extent we provide written advice concerning federal tax matters, we will follow the guidance contained in Circular 230, §10.37, Requirements for Written Advice.

Arguable Positions

We will use our judgment to resolve questions in your favor where a tax law is unclear, provided that we have a reasonable belief that there is substantial authority for doing so. If there are conflicting interpretations of the law, we will explain the possible positions that may be taken on your return. We will follow the position you request, provided it is consistent with our understanding of tax reference materials. Tax reference materials include but are not limited to, the Internal Revenue Code (“IRC”), tax regulations, Revenue Rulings, Revenue Procedures, Private Letter Rulings, court cases, and similar state and local guidance. If the IRS, state or local tax authorities later contest the position you select, additional tax, penalties, and interest may be assessed. We assume no liability, and you hereby release us from any liability, including but not limited to, additional tax, penalties, interest, and related professional fees.

U.S. Filing Obligations Related to Foreign Investments

  • Based on the information you provide, you may have additional filing obligations including but not limited to:
  • Ownership of or an officer relationship with respect to certain foreign corporations (Form 5471);
  • Foreign-owned U.S. corporation or domestic disregarded entity (Form 5472);
  • Foreign corporation engaged in a U.S. trade or business (Form 5472);
  • US transferor of property to a foreign corporation (Form 926);
  • US person with interests in a foreign partnership (Form 8865);
  • US person with interests in a foreign disregarded entity (Form 8858);
  • Ownership or signature authority for foreign bank or financial accounts (FBAR, FinCen Form 114)
  • Statement of specified foreign assets (Form 8938)

You are responsible for informing us of all foreign assets owned directly or indirectly, including but not limited to financial accounts with foreign institutions, other foreign non-account investments, and ownership of any foreign entities, regardless of amount. If upon review of the information you have provided to us, including information that comes to our attention, we believe that you may have additional filing obligations, we will notify you.

Failure to timely file the required forms may result in substantial civil and/or criminal penalties. By your signature below, you agree to provide us with complete and accurate information regarding any foreign investments in which you have a direct or indirect interest, or over which you have signature authority, during the above referenced tax year.

The foreign reporting requirements are very complex. If you have any questions regarding the application of the reporting requirements for your foreign interests or activities, please ask us and we will respond in writing. Only advice that is in writing may be relied upon. We assume no liability for penalties associated with the failure to file or untimely filing of any of these forms.

Third-Party Requests

We will not respond to any request from banks, mortgage brokers or others for verification of any information reported on these tax returns. We do not communicate with third parties or provide them with copies of tax returns.

Support for Examinations by Tax Authorities

Not every interpretation of promulgated tax rules is straightforward and/or without uncertainty. Accordingly, we will use our professional judgment in preparing your returns. If a tax authority should later contest a position taken, or otherwise impose penalties and/or interest for non-compliance with tax laws and regulations, there may be an assessment of additional tax plus interest and/or penalties. We assume no liability for any such additional assessments. Any items resolved against you by the examining agent are subject to certain rights of appeal. In the event of an examination, we may be available to represent you. Since the selection of your return for review or examination is beyond our control, our fee to prepare your returns does not include responding to inquiries or examination by tax authorities, unless you have opted for, and are eligible to obtain, audit insurance as part of your tax return preparation services.

In the event we are required by law, government regulation, subpoena, or other legal process, to produce documents or testimony with respect to this engagement, so long as we are not a party to the proceeding in which the information is sought, you agree to reimburse us for our professional time and expenses, as well as the fees and expenses of our counsel incurred in responding to such demands.

Method of Communication

Our firm may utilize electronic communications (e.g., fax and e-mail) during this engagement. You consent to our firm’s use of electronic communications and recognize and accept the inherent risks related to these forms of communication (including the security risks of interception of or unauthorized access to such communications, the risks of corruption of such communications, and the risks of viruses or other harmful intrusions).

Fees

Fees for our services are based on the complexity of your returns, the tax forms prepared, and the amount of time required at our standard hourly billing rates. Please note that the manner in which the data is presented to us and any necessary tax research on a particular subject can affect the final fee. Our services will conclude upon delivery of the completed tax returns or upon our withdrawal from the engagement, if earlier. Fees are considered earned when payment is received, or services concluded, whichever is earlier. Invoices are due and payable on presentation. Past due balances may be subject to finance and collection charges.

Credit Card Payment upon Delivery

Many clients prefer to pay their tax preparation fees via credit card. We are now retaining credit card information on file so that you need not call us or separately log in to our website to pay your invoice. Instead, upon completion of your tax returns, your invoice can be charged directly to your credit card on file. If your returns qualify for e-filing (and we receive your signed e-file authorizations within 2 weeks of delivery), we will charge the balance of your invoice to your credit card upon receipt of your signed e-file authorization forms. If your returns must be paper filed or e-filed later, we will charge the balance of your invoice to your card upon delivery of your returns to you.

IMPORTANT

If you provide a personal credit card to pay the Fiduciary invoice, it is imperative that the Trust/Estate reimburses you for this expense. Failure to receive reimbursement creates a gift from you to the Trust/Estate. Such a gift may produce unintended consequences for gift, estate and Generation-Skipping Transfer (“GST”) tax purposes.

If you already have a credit card on file with us, kindly select the option on the following payment page to confirm that the information has not changed.

If you would like the convenience of having your credit card information on file with us and having your tax preparation fees charged to your card, please complete the form on the following payment page to authorize us to charge your tax preparation fees to your credit card upon completion of the returns.

If you authorize The Wolf Group, PC to prepare your 2020 fiduciary income tax returns pursuant to the terms set forth above, please sign below. Retain a copy of this letter for your records. If we do not receive a signed original of this letter but receive a completed copy of the Tax Organizer and/or supporting documentation, then such receipt shall be deemed to evidence your acceptance of the terms set forth herein.

We want to express our appreciation for this opportunity to serve you. Very truly yours,

The Wolf Group, PC

 

Additional Engagement Terms

Responsibilities of the Client

A fundamental term of this Agreement is that the Client will provide us with all information relevant to the services to be performed and to provide us with any reasonable assistance as may be required to properly perform the engagement. The Client agrees to bring to our attention any matters that may reasonably be expected to require further consideration to determine the proper treatment of any relevant item. The Client also agrees to bring to our attention any changes in the information as originally presented as soon as such information becomes available. Unless otherwise indicated, any deliverables are solely for Client’s internal use and benefit.

Responsibilities of The Wolf Group, PC (“The Wolf Group”)

We will perform our services on the basis of the information you have provided and in consideration of the applicable federal, state or local laws, regulations and associated interpretations relative to the appropriate jurisdiction as of the date the services are provided. Tax laws and regulations and/or their interpretation are subject to change at any time, and such changes may be retroactive in effect and may be applicable to advice given or other services rendered before their enactment dates. We do not assume responsibility (and will have no liability) for such changes occurring after the date we have completed our services.

Engagement Limitations

The services performed under this Agreement do not include the provision of legal advice and we make no representations regarding questions of legal interpretation. Client should consult with its attorneys with respect to any legal matters or items that require legal interpretation, under federal, state or other type of law or regulation. As you may be aware, tax returns and other filings are subject to examination by taxing authorities. We will be available to assist the Client in the event of an audit or any issue for which we have provided services under this Agreement. However, unless otherwise indicated, our fees for these additional services are not included in our fee for the services covered by this Agreement.

Disassociation or Termination of Engagement

Either party may terminate this Agreement at any time upon written notice of termination to the other party. In the event of termination, Client will be responsible for fees earned and expenses incurred through the actual date of termination.

Except to the extent finally determined to have resulted from the gross negligence or other intentional misconduct of The Wolf Group, The Wolf Group’s liability to pay damages for any losses incurred by the client as a result of breach of conduct, negligence or other tort committed by The Wolf Group, is limited to the total amount of fees charged by The Wolf Group for the particular service provided under this Agreement to which such claim relates.

Other Provisions

Neither party shall be liable to the other for any delay or failure to perform any of the services or obligations set forth in this Agreement due to causes beyond its reasonable control.

This Agreement shall be governed by and construed, interpreted and enforced in accordance with the laws of the State of Virginia, without giving effect to the provisions relating to conflict of laws.

The Wolf Group, PC is a member of Nexia International, an international network of independent accounting and consulting firms. Nexia International does not accept any responsibility for the commission of any act, or omission to act by, or the liabilities of, any of its members. Membership of Nexia International, or associated umbrella organizations, does not constitute any partnership between members, and members do not accept any responsibility for the commission of any act, or omission to act by, or the liabilities of, other members.