It is the responsibility of the taxpayer to ensure their tax return has been filed, even when an accountant or other tax preparer is hired, ruled the U.S. Court of Appeals for the 11th Circuit.

Merely relying on a certified public accountant’s (CPA) assurance that the return has been filed or will be filed with the Internal Revenue Service (IRS) does not constitute “reasonable cause” for failing to file a return on time. This standard applies regardless of whether e-filing is used or if paper returns are mailed in.

The case involved Wayne Lee, an individual taxpayer who found himself facing over $70,000 in penalties for failing to file his federal tax returns from 2014 to 2016. Lee entrusted his CPA, Kevin Walsh, to handle the preparation and filing of his federal income tax returns for those years. Walsh failed to file a single return—blaming problems with the e-filing process.

The critical question in this case revolved around whether the U.S. Supreme Court’s “bright-line rule,” established in U.S. v. Boyle (1985), applies to e-filed tax returns. The Supreme Court ruled in Boyle that the mere “reliance on an agent” does not constitute “reasonable cause” for filing a return late. The 11th Circuit justices concluded that Boyle’s rule extends to e-filed returns, meaning Lee’s reliance on his CPA did not excuse his failure to file on time.

The court emphasized that signing Form 8879, which authorizes e-filing by a tax professional, does not relieve the taxpayer of the duty to exercise ordinary business care and prudence.

In a concurring opinion, U.S. Circuit Judge Barbara Lagoa suggested two proactive steps taxpayers can take to protect themselves. First, confirm independently with the IRS that they received the return. Second, consider filing returns independently on paper. This “requires the taxpayer to give a ‘hand-signed and dated statement’ to the tax return preparer.” Such a statement makes it clear that the taxpayer will be the one who files the return.

Source: Wayne Lee v. U.S., the U.S. District Court for the 11th Circuit, Case No. 22-10793.

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