What action can I take if a tax preparer cashed my check but never filed my taxes?

Thanks for all this info! Do you think I have a good case if I go the small claims route? Also, with the penalties from the IRS, is there any way to get those reduced since it wasn't my fault?

You have a strong small claims case since you paid for a service that wasn't provided, and you have documentation of payment and the resulting damages. Keep all evidence of attempted communications with the preparer as well, as this shows you tried to resolve the issue directly. As for the IRS penalties, you should absolutely request penalty abatement by filing Form 843. Explain that you hired a preparer who failed to file your return despite being paid to do so. The IRS has a "reasonable cause" exception that often applies in situations like yours where you took responsible steps but were let down by a professional you trusted. Include all documentation with your abatement request.

Did you need to provide them with all your tax docs? I'm nervous about uploading sensitive financial info to some website I've never heard of.

How long did it take for you to get the penalties removed? I'm in a similar boat and worried this will drag on forever.

You only need to upload the relevant documents related to your case - the receipt from the tax preparer, proof of payment, the IRS notice, and any communications showing you tried to resolve the issue. You don't need to provide your full tax returns or sensitive financial details. It took about 45 days total from when I submitted my penalty abatement request until I got the confirmation letter that the penalties were removed. The key was having a well-organized case with the right documentation and citing the specific reasonable cause provisions that applied to my situation. The IRS actually moved pretty quickly once they had everything properly presented.

Does this actually work? Sounds too good to be true. The IRS phone system is a nightmare.

This seems like a waste of money. Just keep calling the IRS yourself and eventually you'll get through. Why pay someone to do what you can do for free?

It absolutely works! I was connected with an IRS agent within about 2 hours of using the service, compared to the 6+ hours I spent trying on my own the previous day (and never getting through). The service basically uses technology to navigate the phone system and wait in the queue for you. I understand the skepticism, but my time is valuable. Spending an entire day on hold isn't free - it's costing me work hours and sanity. The IRS agent I spoke with was able to immediately pull up my file, confirm I had grounds for penalty abatement, and tell me exactly what forms to file. Having that direct conversation saved me from filing the wrong paperwork or missing important deadlines.

That's a great point! I actually never checked his credentials, just assumed he was legit. How would I go about verifying if he has a PTIN?

Unfortunately there's no public database to verify someone's PTIN status. However, any legitimate tax preparer must sign your tax return and include their PTIN on it. If you have a copy of last year's return (or any previous year they prepared), check for their signature and PTIN at the bottom of the form. If they claimed to be a CPA or Enrolled Agent, those credentials can be verified. For CPAs, go to your state's Board of Accountancy website. For Enrolled Agents, you can call the IRS Office of Enrollment at 1-855-472-5540. Either of these professional designations means they're held to higher standards and have additional oversight bodies where you can file complaints.

I had something similar happen in 2023 and did file a police report. They took it and gave me a case number but honestly didn't seem very interested in pursuing it. However, having that police report number was super helpful when dealing with the IRS and in small claims court. The judge took it way more seriously seeing I'd filed fraud charges.

Great additional points! I hadn't thought about victim compensation funds - that could really help offset some of the financial damage. Quick question about the bank documentation - would transaction records showing exactly when the check was cashed be enough, or should I also try to get copies of the actual deposited check images? My bank charges for those but it might be worth it if it strengthens my case.

The transaction records showing when the check was cashed should be sufficient for most purposes, especially since they clearly establish the timeline - that you paid for services but didn't receive them. However, if your case goes to small claims court or if the IRS requests additional documentation during their investigation, having the actual check images could be valuable because they show the preparer's endorsement and account information. I'd suggest starting with the basic transaction records since they're free, and only pay for the check images if you need them later. Most penalty abatement requests and initial complaints won't require that level of detail. You can always request them later if your case escalates or if the preparer tries to claim they never received payment. Also, make sure to document any attempts you've made to contact the preparer since the check was cashed - unanswered calls, unreturned messages, etc. This shows you acted in good faith and tried to resolve the issue before involving authorities.