Professional Tax Research IRS Guidance
Parker Tax Pro Library
online tax research Parker Tax Pro Library professional tax research Like us on Facebook Follow us on Twitter View our profile on LinkedIn Find us on Pinterest
Move over CCH and BNA
Parker Tax Publishing - Expert Tax Analysts
Parker Tax Publishing - Tax Research Solutions
Tax Research Articles Tax Research Parker's Tax Research Articles Accounting Research CPA Client Letters Tax Research Software Client Testimonials Tax Research Software tax research

Affordable Federal Tax Research Solutions - Parker Tax Pro Library

Professional Tax Software for CPAs



Certified Public Accountant (CPA) Cannot Be Sued for Incorrect Form W-2.
(Parker's Federal Tax Bulletin: August 5, 2013)

The former employee of a CPA firm's client could not sue the CPA firm and one of its accountants for damages for the filing of a false Form W-2; damages could be obtained only from the person responsible for filing the Form W-2. Swartwout v. Edgewater Grill LLC, et al., 2013 PTC 197 (D.C. Mich. 7/12/13).

In 2010, David Swartwout worked for Edgewater Grill from May through October. As a result of receiving what he said were fraudulent W-2 statements, David filed a civil action for damages against Edgewater Grill; Blanche Klaus, the sole member of Edgewater Grill LLC; H&S Companies, P.C., a CPA firm; and Ward A. Van Dam, C.P.A., the managing partner of H&S Companies. David claimed that they submitted a fraudulent Form W-2 covering his wages for 2010 and that, when he informed them of major discrepancies in his W-2, they failed to provide a corrected copy. David's complaint also included a claim of conspiracy against H&S Companies and Van Dam for filing a materially false W-2 and aiding and abetting in the preparation of a fraudulent W-2. H&S Companies and Van Dam moved for summary judgment.

Code Sec. 7434 provides that if any person willfully files a fraudulent information return with respect to payments purported to be made to any other person, the other person may bring a civil action for damages against the person filing the return.

David argued that H&S and Van Dam created and caused the erroneous W-2 form to be filed. Thus, the court was faced with the question of whether liability under Code Sec. 7434(a) attaches to those who assist an employer in preparing and filing information returns.

A district court held that liability for filing a false information return was limited to the person responsible for filing the return, which was David's employer. The court rejected David's claims against H&S Corporation and Van Dam. The court cited Vandenheede v. Vecchio, 2013 PTC 198 (D.C. Mich. 2013), in which a district court held that, although accountants and attorneys assist in the preparation of returns, Reg. Sec. 301.6721-1 provides that only the person required to file the information return can be held liable under Code Sec. 7434. The court noted that in Central Bank of Denver, N.A. v. First Interstate Bank of Denver, N.A., 511 U.S. 164 (1994), the Supreme Court held that common law claims of secondary liability cannot be used to expand the class of persons liable for statutory violations. Because no secondary liability was implied for claims under Code Sec. 7434, H&S Corporation and Van Dam were entitled to summary judgment.

For a discussion of information return penalties, see Parker Tax ¶262,130.

Parker Tax Publishing Staff Writers


Disclaimer: This publication does not, and is not intended to, provide legal, tax or accounting advice, and readers should consult their tax advisors concerning the application of tax laws to their particular situations. This analysis is not tax advice and is not intended or written to be used, and cannot be used, for purposes of avoiding tax penalties that may be imposed on any taxpayer. The information contained herein is general in nature and based on authorities that are subject to change. Parker Tax Publishing guarantees neither the accuracy nor completeness of any information and is not responsible for any errors or omissions, or for results obtained by others as a result of reliance upon such information. Parker Tax Publishing assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect information contained herein.

Parker Tax Pro Library - An Affordable Professional Tax Research Solution.

Professional tax research

We hope you find our professional tax research articles comprehensive and informative. Parker Tax Pro Library gives you unlimited online access all of our past Biweekly Tax Bulletins, 22 volumes of expert analysis, 250 Client Letters, Bob Jennings Practice Aids, time saving election statements and our comprehensive, fully updated primary source library.

Parker Tax Research

Try Our Easy, Powerful Search Engine

A Professional Tax Research Solution that gives you instant access to 22 volumes of expert analysis and 185,000 authoritative source documents. But having access won’t help if you can’t quickly and easily find the materials that answer your questions. That’s where Parker’s search engine – and it’s uncanny knack for finding the right documents – comes into play

Things that take half a dozen steps in other products take two steps in ours. Search results come up instantly and browsing them is a cinch. So is linking from Parker’s analysis to practice aids and cited primary source documents. Parker’s powerful, user-friendly search engine ensures that you quickly find what you need every time you visit Our Tax Research Library.

Parker Tax Research Library

Dear Tax Professional,

My name is James Levey, and a few years back I founded a company named Kleinrock Publishing. I started Kleinrock out of frustration with the prohibitively high prices and difficult search engines of BNA, CCH, and RIA tax research products ... kind of reminiscent of the situation practitioners face today.

Now that Kleinrock has disappeared into CCH, prices are soaring again and ease-of-use has fallen by the wayside. The needs of smaller firms and sole practitioners are simply not being met.

To address the problem, I’ve partnered with a group of highly talented tax writers to create Parker Tax Publishing ... a company dedicated to the idea that comprehensive, authoritative tax information service can be both easy-to-use and highly affordable.

Our product, the Parker Tax Pro Library, is breathtaking in its scope. Check out the contents listing to the left to get a sense of all the valuable material you'll have access to when you subscribe.

Or better yet, take a minute to sign yourself up for a free trial, so you can experience first-hand just how easy it is to get results with the Pro Library!


James Levey

Parker Tax Pro Library - An Affordable Professional Tax Research Solution.

    ®2012-2017 Parker Tax Publishing. Use of content subject to Website Terms and Conditions.

IRS Codes and Regs
Tax Court Cases IRS guidance