Tax Malpractice Damages: A Comprehensive Review of the Elements and the Issues

This article explores the proper measure of damages in tax malpractice litigation. The author will focus on damages caused by attorneys and accountants interchangeably. In tax malpractice situations, the most direct types of damages encountered consist of additional taxes resulting from the malpract...

Full description

Saved in:
Bibliographic Details
Published inThe Tax lawyer Vol. 61; no. 3; pp. 705 - 773
Main Author TODRES, JACOB L.
Format Journal Article
LanguageEnglish
Published Washington Section of Taxation, American Bar Association 22.03.2008
American Bar Association
Subjects
Accountancy
Accountants
Advisors
Attorneys
Breach of contract
Damage claims
Damages
Defendants
Income taxes
Injuries
Laws, regulations and rules
Legal consultants
Litigation
Malpractice
Negligence
Plaintiffs
Professional malpractice
Professions
Recoverable damages
Speculative damages
State court decisions
Tax attorneys
Tax benefits
Tax courts
Tax planning
Tax preparation
Tax returns
Taxpaying
Torts
United States > US
Online AccessGet full text

Cover

More Information
Summary:This article explores the proper measure of damages in tax malpractice litigation. The author will focus on damages caused by attorneys and accountants interchangeably. In tax malpractice situations, the most direct types of damages encountered consist of additional taxes resulting from the malpractice, interest and penalties imposed on the additional taxes, and corrective costs incurred in attempting to eliminate or mitigate all or some of the foregoing damages. Since the determination of recoverable damages is a matter of state law, differences among the states are to be expected and do in fact exist. In its attempt to make a plaintiff whole, the law permits recovery for not just the direct damages caused by a defendant, but also for all damages resulting because of the defendant's negligence. Damages for emotional distress or mental anguish are generally not recoverable in tax malpractice situations, though a number of exceptions exist in especially egregious situations.
ISSN:0040-005X
2329-6089