Terms - The John Ellis Company

THE JOHN ELLIS COMPANY
ENGAGEMENT TERMS AND CONDITIONS

Updated February 25, 2026

ADMINISTRATION

Cancellation and Late Arrival Policy

Due to the high demand for our services, we require (at least) a twenty-four (24) hour cancellation notice. Failure to do so will result in a charge of one hour at the hourly rate listed in the Engagement Agreement. Two “no shows” for a schedule appointment will terminate the engagement agreement.

In addition, arriving late for an appointment has an impact on time I have available to service other clients. Failure to arrive on time for an appointment will result in a penalty fee of $25.00 if you are late for more than 15 minutes. Three late arrivals (more than 15 minutes) in a 12-month period for a scheduled appointment will terminate the engagement agreement.

All fees for late cancellation or “no-show are due when 24 hours of the schedule appointment and fees for late arrival are due before the meeting is to commence. These fees are due regardless of if payment arrangements are in place for the engagement and cannot be added to the outstanding balance. Nonpayment of these fees will terminate the agreement.

We understand from time–to-to a person might have unexpected emergencies like a car accident, natural disaster, unexpected illness, or death in the family. This policy recognizes that unexpected life events do happen thus the fee will be waived for one occurrence per year.

Independent Contractor

When providing services to you, your company or both, we will be functioning as an independent contractor and in no event will we or any of our employees/independent contractors be an officer of you, nor will our relationship be that of joint ventures, partners, employer and employee, principal and agent, or any similar relationship giving rise to a fiduciary duty to you.

Our obligations under this agreement are solely obligations of The John Ellis Company, and no partner, principal, employee, or agent of The John Ellis Company shall be subjected to any personal liability whatsoever to you or any person or entity.

Background Checks

As a matter of our Firm policy, we perform background checks, which may require out-of-pocket expenses, on potential clients and/or on existing clients, on as determined basis. The terms and conditions of this engagement are expressly contingent upon the satisfactory completion of our investigatory procedures, and we reserve the right to withdraw from any relationship should information which we deem to be adverse come to our attention.

Newsletters and Similar Communications

We may send newsletters, emails, explanations of technical developments or similar communications to you. These communications are of a general nature and should not be construed as professional advice. We may not send all such communications to you. These communications do not, by themselves, constitute a client relationship with you, nor do they constitute advice or an undertaking on our part to monitor issues for you.

Conversion of Employee

Conversion of any employee of The John Ellis Company to that of Client will require a fee of three (3) times the annual compensation based on a 40-hour work week regardless if the employee actually works 40 hours per week.

Referrals

In the course of providing services to you, you may request referrals to products or professionals such as attorneys, brokers, or investment advisors. We may identify professional(s) or product(s) for your consideration. However, you are responsible for evaluating, selecting, and retaining any professional or product and determining if the professional or product can meet your needs. You agree that we will not oversee the activities of and have no responsibility for the work product of any professional or the suitability of any product we refer to you or that you separately retain. Further, we are not responsible for any services we perform that fail to meet the intended outcomes as a result of relying on the services of other professionals or products you may retain.

Conflicts of Interest

If we, in our sole discretion, believe a conflict has arisen affecting our ability to deliver services to you in accordance with either the ethical standards of our firm or the ethical standards of our profession, we may be required to suspend or terminate our services without issuing our work product.

Referrals

WORK PRODUCT OF THE JOHN ELLIS COMPANY

Workpapers and other documents created by us are our property

Workpapers and other documents created by us are our property and are covered by copyright. They will remain under our control and copies are not to be distributed without your written request and our prior written consent.

Use and Reliance

The use of the work product of The John Ellis Company (except for copies of filed tax returns) shall be limited to the item's stated purpose (if any) and is for Client's purposes and internal use only. Unless otherwise agreed to in writing. The work product is not to be relied upon by any third parties in any manner or for any purpose; this engagement does not create any privity between The John Ellis Company and any third party. The John Ellis Company is indemnified and hold harmless and its personnel or independent contractors from all third-party claims, liabilities, costs, and expenses in the event of any unauthorized reliance. The conclusions expressed in our deliverables are based upon the facts presented by the Client and may be inapplicable if the actual facts differ from those presented in any respect.

Limitations on Advice Regarding “Nexus Rules”

Our services are not intended to determine whether you have filing requirements in other taxing jurisdictions than the one you have informed us of. CPA is available under the terms of a separate engagement letter to provide a nexus study that will enable our firm to determine whether any other state tax filings are required.

Limitations on Oral and Email Communications

During the course of our engagement, we may share our views or preliminary thoughts on certain matters with you, either orally or via email. These communications are based on limited research and an incomplete review of the relevant facts. As such, they should not be considered formal advice.

Relying solely on oral or email communications (not accompanied by a formal memorandum) may carry risks. You acknowledge and accept responsibility for any consequences, including additional taxes, penalties, or interest—that may result from choosing not to request a more thorough analysis. This limitation does not apply in cases of our gross negligence or willful misconduct, nor does it apply to written advice provided as part of a separate engagement.

If you would like us to provide formal written advice on a matter discussed informally, we will confirm the scope and terms of that service in a separate engagement letter.

We may also send you newsletters, technical updates, or similar communications. These are general in nature, do not constitute professional advice, and do not establish a client relationship or an obligation on our part to monitor issues on your behalf.
Should you require a formal opinion or advice on any accounting or tax matter during this engagement, we will prepare a separate engagement agreement and provide our conclusions in writing. Any oral advice provided without such an agreement is not intended to be, and should not be relied upon, as, a formal opinion.

ELECTRONIC DATA COMMUNICATION AND STORAGE

We are committed to safekeeping of your confidential information, and we maintain physical, electronic, and procedural safeguards to protect your information.

In the interest of facilitating our services to you, we may send data over the Internet, temporarily store electronic data via computer software applications hosted remotely on the Internet or utilize cloud-based storage.

Your Confidential Information

Your confidential electronic data may be transmitted or stored using these methods. In using these data communication and storage methods, our firm employs measures designed to maintain data security. We use reasonable efforts to keep such communications and electronic data secure in accordance with our obligations under applicable laws, regulations, and professional standards.

You recognize and accept that we have no control over the unauthorized interception or breach of any communications or electronic data once it has been transmitted or if it has been subject to unauthorized access while stored, notwithstanding all reasonable security measures employed by us. You consent to our use of these electronic devices and applications during this engagement.

Data Access

If you request that we access your files, documents or other information in a cloud-based or web-accessed hosting service or other third-party system accessed via the internet, including, without limitation iCloud, Dropbox, Google Docs, Google Drive, a data room hosted by a third-party, or a similar service or website (collectively, “Cloud Storage”), you will confirm with any third-parties assisting with or hosting the Cloud Storage that either such third-party or you (and not us) is responsible for ensuring the confidentiality of all information while utilizing the Cloud Storage, complying with all applicable laws relating to the Cloud Storage and any information contained in the Cloud Storage, providing us access to the information in the Cloud Storage, and protecting the information in the Cloud Storage from any unauthorized access to the information, including without limitation unauthorized access to the information when in transit to or from the Cloud Storage. You warrant that you have authority to provide us with access to information in the Cloud Storage and that providing us with access to information in the Cloud Storage complies with all applicable laws, regulations, or duties owed to third-parties, and you agree to hold us harmless from and against any matters relating to or arising from our use of the Cloud Storage. In addition, while CPA has established procedures designed to protect the confidentiality of your information, you acknowledge and agree that the confidentiality of any communication or material transmitted over the Internet through an unencrypted method cannot be guaranteed and that any breach of confidentiality that occurs thereby shall not be deemed to be a breach of The John Ellis Company’s confidentiality obligations.

To the extent you provide CPA with access to Cloud Storage from which we will download your trial balance or other information, you agree that the data is accurate as of the date and time you authorize it to be downloaded.

You acknowledge that your confidential information may be transmitted to us through the Client Portal. You shall notify us in writing of your employees, representatives, or other agents to be provided access to such portal or system; upon the termination of such status, you shall immediately notify us in writing. You acknowledge that you are responsible for the actions of your current and former employees, representatives, or other agents in connection with the transmission of your information.

Use of Email

For your safety, e-mailing confidential information at any time is not allowed. This will put your identity and financial information at risk as well as place this firm under IRS scrutiny.

Emails can be intercepted and read, disclosed, or otherwise used or communicated by an unintended third party, or may not be delivered to each of the parties to whom they are directed and only to such parties, we cannot guarantee or warrant that emails from us will be properly delivered and read only by the addressee. Therefore, we specifically disclaim and any liability or responsibility whatsoever for interception or unintentional disclosure of emails transmitted by us in connection with the performance of this engagement. In that regard, you agree that we shall have no liability for any loss or damage to any person or entity resulting from the use of email transmissions, including any consequential, incidental, direct, indirect, or special damage, such as loss of revenues or anticipated profits, or disclosure or communication of confidential or proprietary information.

Transmitting confidential information can only be done through the Client Portal or by fax. Failing to abide by this will terminate this and any agreement(s) with the John Ellis Company.

If you decide to transmit confidential information in a manner other than a secure portal or fax, you agree that we are not responsible for any liability including but not limited to, (a) any loss or damage of any nature, whether direct or indirect, that may arise as a result of our sending confidential information in a manner other than a secure portal, and (b) any damages arising as a result of any virus being passed on or with, or arising from any alteration of, any email message.

Client Portal

To enhance our services to you, we will utilize a Client Portal that is located on the Company’s web site
which is described below (hereinafter referred to as Client Portal). This is a collaborative, virtual workspace in a protected, online environment. The Client Portal permits real-time collaboration across geographic boundaries and time zones and allows The John Ellis Company and you to share data, engagement information, knowledge, and deliverables in a protected environment.

While the Client Portal backs up data to our server, you are responsible for maintaining your own copy of this information. We do not provide back-up services for any of your data or records, including information we provide to you. Portals are utilized solely as a method of transferring data and are not intended for the storage of your information.

Computer Access is Required:

To effectively work with The John Ellis Company, you need access to a computer, either at home or at a public computer access facility like a public library. Please note the following:

A public computer access facility is not secure so you need to be very careful to not save your work on the hard drive, and you must not use e-mail but our Client Portal and change your password frequently. By entering into an agreement with The John Ellis Company, you acknowledge that we are not responsible for identity or financial theft if you choose to use a public computer
An internet connection at home is highly recommended. The costs vary affordable.
You need an E-Mail account that is free of spam and other messages that will interfere with receiving our e-mails. Many times, internet providers offer e-mail access, some for free. But be careful, generally free e-mail is not that private and is subject to hacking and spam.
Get an All-In-One printer that allows you to scan documents and fax as well as printing. We have seen them advertised for between $60 to $200 at major stores. We recommend you get one that has a feeder which will make required copies easier.
Download the free computer program called “CutePDF Writer”. This simple interface allows Windows users to save documents to their hard drive as a .pdf file. It works just like having a printer connected to your computer. This will save you time in sending documents to us.

RECORDS MANAGEMENT

Record Retention and Ownership

We will return any original records and documents you provide to us by the conclusion of the engagement. Our copies of your records and documents are for our documentation purposes only and are not a substitute for your own records and do not mitigate your record retention obligations under any applicable laws or regulations. You are responsible for maintaining complete and accurate books and records, which may include financial statements, schedules, tax returns and other deliverables provided to you by us. If we provide deliverables or other records to you via the Client Portal, you must download this information within 30 days. Professional standards restrict us from being the sole repository of your original data, records, or information.

Our workpapers will be maintained by us in accordance with our firm’s record retention policy and any applicable legal and regulatory requirements. Our firm’s record retention policy is as follows: We keep copies of the records you have supplied us along with our work papers for your engagement for a period of seven years. After seven years, our work papers and engagement files are destroyed. All of your original records will be returned to you at the end of this engagement. Our working papers and files are not a substitute for the original records, and you should keep them in a safe place. Catastrophic events or physical deterioration may result in damage to or destruction of our firm’s records, causing the records to be unavailable before the expiration of the retention period.

Working Paper Access Requests by Regulators and Others

State, federal, and foreign regulators may request access to or copies of certain workpapers pursuant to applicable legal or regulatory requirements. Requests also may arise with respect to peer review, an ethics investigation, the sale of your organization, or the sale of our accounting practice. If requested, access to such workpapers will be provided under the supervision of firm personnel. Regulators may request copies of selected workpapers to distribute the copies or information contained therein to others, including other governmental agencies.

If we receive a request for copies of selected workpapers, provided that we are not prohibited from doing so by applicable laws or regulations, we agree to inform you of such request as soon as practicable. You may, within the time permitted by our firm to respond to any request, initiate such legal action as you deem appropriate, at your sole expense, to attempt to limit the disclosure of information. If you take no action within the time permitted for us to respond, or if your action does not result in a judicial order protecting us from supplying requested information, we may construe your inaction or failure as consent to comply with the request.

Summons or Subpoenas

All information you provide to us in connection with this engagement will be maintained by us on a strictly confidential basis.
If we receive a summons or subpoena which our legal counsel determines requires us to produce documents from this engagement or testify about this engagement, provided that we are not prohibited from doing so by applicable laws or regulations, we agree to inform you of such summons or subpoena as soon as practicable. You may, within the time permitted by our firm to respond to any request, initiate such legal action as you deem appropriate, at your sole expense, to attempt to limit discovery. If you take no action within the time permitted for us to respond, or if your action does not result in a judicial order protecting us from supplying requested information, we may construe your inaction or failure as consent to comply with the request.

If 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 legal counsel, incurred in responding to such requests.

CONFLICTS OF INTEREST

CPA is not aware of any relationship that he may have with another person, entity, product, or service which could impair his objectivity. However, if you believe that the CPA may have such a relationship, it is your duty and obligation as the client to bring such relationship to the express attention of CPA such that the CPA may as necessarily obtain the appropriate consent from you to perform this engagement.

DISCLOSURE OF PRIVACY POLICY

This Firm’s Policy

All information you provide to this firm is handled with the utmost confidentiality. Your personal information will only be shared with employees or independent contractors of our firm who need to know this information in order to complete the work you have hired our firm to do. Other than the IRS permitted disclosure to a tax return processor for the purpose of preparing and e-filing your tax return or tax resolution forms and schedules, this firm will not disclose your personal information to anyone outside our firm without your express written permission to do so, or unless the firm is legally required or permitted to do so. For example, if a mortgage lender contacts this office for a copy of your return or information about it; you will be required to provide written consent to disclose your tax return information prior to this firm responding to that request. For policies concerning our website please go to https://policies.google.com/privacy?hl=en

Federally Authorized Practitioner – Client Privilege

Internal Revenue Code §7525, Confidentiality Privileges Related to Taxpayer Communication, provides a limited confidentiality privilege applying to tax advice embodied in taxpayer communications with federally authorized tax practitioners in certain limited situations.

This privilege is limited in several important respects. For example, the privilege may not apply to your records, state tax issues, state tax proceedings, private civil litigation proceedings, or criminal proceedings.

While we will cooperate with you with respect to the privilege, asserting the privilege is your responsibility. Inadvertent disclosure of otherwise privileged information may result in a waiver of the privilege. Please contact us immediately if you have any questions or need further information about this federally authorized practitioner-client privilege.

Personal Information We Collect

We collect public personal information about you on a as need basis to perform background checks, to complete our engagements or to enhance our services to you. We also collect nonpublic personal information about you that is either provided to us by you or obtained by us with your authorization.

Parties to Whom We Disclose Information

For current and former clients, we do not disclose any nonpublic personal information obtained in the course of our practice except as required or permitted by law. Permitted disclosures include, for instance, providing information to our employees or independent contractors and, in limited situations, to unrelated third parties who need to know that information to assist us in providing services to you. In all such situations, we stress the confidential nature of information being shared.

Confidential Information of Client

To the extent that, in connection with this engagement, The John Ellis Company comes into possession of any proprietary or confidential information of Client, The John Ellis Company will not disclose such information to any third party without consent, except (a) as may be required by law, regulation, judicial or administrative process, or in accordance with applicable professional standards, or in connection with litigation pertaining hereto, or (b) to the extent such information (i) shall have otherwise become publicly available (including, without limitation, any information filed with any governmental agency and available to the public) other than as the result of a disclosure by The John Ellis Company in breach hereof, (ii) is disclosed by Client to a third party without substantially the same restrictions as set forth herein, (iii) becomes available to The John Ellis Company on a non-confidential basis from a source other than Client which The John Ellis Company believes is not prohibited from disclosing such information to The John Ellis Company by obligation to Client, (iv) is known by The John Ellis Company prior to its receipt from Client without any obligation of confidentiality with respect thereto, or (v) is developed by The John Ellis Company independently of any disclosures made by Client to The John Ellis Company of such information. In addition, Client acknowledges and agrees that any such information that comes to the attention of The John Ellis Company in the course of performing this engagement may be considered and used by The John Ellis Company in the context of responding to its professional obligations as the independent accountants for Client. Solely to the extent that information obtained from Client is protected health information pursuant to the Health Insurance Portability and Accountability Act (as amended from time to time, "HIPAA"), this Agreement shall be deemed to incorporate all terms that HIPAA requires to be included in a business associate contract relating to such information.

Third-Party Service Providers

In the interest of enhancing our availability to meet your professional service needs while maintaining service quality and timeliness, we may use a third-party service provider to assist us. This may include provision of your confidential information to the third-party service provider. We require our third-party service providers to have established procedures and controls designed to protect client confidentiality and maintain data security. As the paid provider of professional services, our firm remains responsible for exercising reasonable care in providing such services, and our work product will be subjected to our firm's customary quality control procedures.

By accepting the terms and conditions of our engagement, you are providing your consent and authorization to disclose your confidential information to a third-party service provider, if such disclosure is necessary to deliver professional services or provide support services to our firm.

Express Authorization to Disclose

As provided in Treasury Regulations, Client and each employee, representative, or other agent of Client may disclose to any and all persons without limitation of any kind the tax treatment and tax structure of any transaction that may fall within the scope of this engagement and all materials of any kind, including opinions or other tax analyses, that may be provided to Client by The John Ellis Company relating to any such tax treatment and tax structure.

Disclosure of Transactions and Other Financial Information

The Internal Revenue Code of 1986, as amended ("IRC"), and certain state laws require that you disclose on or with your tax returns certain transactions or other financial information. For example, Treasury Regulations, commonly known as the "Tax Shelter Regulations", require taxpayers to disclose certain types of transactions on a Form 8886 attached to their tax returns and filed with the IRS office of Tax Shelter Analysis. Failure to disclose could result in substantial penalties, even if the transaction's tax benefits are appropriate and even if there is no understatement of tax. As your professional tax return preparer, we will make every effort to inform you of your specific disclosure responsibilities. However, our tax return preparation services do not include any separate investigation to determine whether there are any transactions or other matters that must be disclosed on your tax returns, though we will advise you if we conclude that any such disclosure is required. If you would like us to review any transaction or matter to determine if it must be reported, please contact us to discuss expanding the scope of our services.

Unless you advise us otherwise or specific disclosure information is furnished to us, we will assume that none of the transactions that will be reflected on your return were: (1) entered into subject to an agreement that requires you to keep the transaction confidential, (2) entered into subject to an agreement that the fee you paid would be contingent upon your receiving the transaction's intended tax benefits, (3) identified in Treasury Regulations as loss transactions that must be disclosed, including loss transactions that pass-through to you from S Corporations, partnerships and trusts, if applicable, or (4) the same as or substantially similar to a transaction identified by the IRS as a tax avoidance transaction. The following IRS web address provides an up-to-date list of transactions the IRS has identified as tax avoidance transactions:

https://www.irs.gov/businesses/corporations/listed-transactions

Or go to the IRS' home page at www.irs.gov and search for "tax shelters." We are, of course, available for a separate fee to assist you to determine if you have entered into one of these transactions.

It is important to note that the IRS can identify transactions as tax avoidance transactions subsequent to your entering into them; in this event you could be retroactively required to disclose your participation in the transaction.
The other categories of transactions that must be disclosed would ordinarily be reflected in the information you provide us with to prepare your tax return. However, determining whether you should disclose these transactions may require analysis of information above and above that otherwise necessary to prepare your return and could result in our having to charge additional fees.

AI DISCLOSURE STATEMENT

Our Use of Artificial Intelligence

The John Ellis Company may use artificial intelligence (AI) tools to assist with certain aspects of our professional services, such as drafting, research, data organization, and workflow efficiency.
What AI Does – and Does Not – Do

AI tools assist our professionals but do not replace human expertise or professional judgment.
All client work is reviewed and finalized by qualified professionals.
We remain fully responsible for the accuracy, integrity, and compliance with our services.

Confidentiality and Data Protection

We do not input client confidential information into public AI tools.
Any AI tools used are subject to confidentiality, security, and vendor oversight standards.
Client data ownership and privacy obligations are always preserved.

Professional and Ethical Standards - Our use of AI aligns with:

The AICPA Code of Professional Conduct
Applicable independence, objectivity, and due care standards
Regulatory and professional guidance applicable to CPAs

Questions or Concerns

Clients with questions about our use of AI are encouraged to contact Firm’s management team.

YOUR RESPONSIBILITIES

As A Taxpayer

The tax system in the United States reflects a social contract between the various Taxing Authorities and Taxpayers. Within this unwritten contract, Taxpayers have obligations such as reporting and paying tax, and the Taxing Authorities have obligations to Taxpayers to provide service and oversight. Many times, Taxpayer gets in trouble with the Taxing Authorities because they fall short in fulfilling their obligations, either intentionally or due to circumstances beyond their control. Unfortunately, regardless of the reasons, failing to fulfill one’s obligations can have serious civil and/or criminal consequences.

A Taxpayer’s obligations can be summarized as follows:

Register with the Taxing Authority.
Know your tax reporting obligations, and either ask a tax professional or the Taxing Authority for instructions when uncertain.
File complete and accurate tax returns on time.
Substantiate information on tax returns and claims for refund.
Pay taxes on time. The law requires having either enough withholding from your paycheck or making four (4) quarterly tax payments the total of which much be 80% of your tax liability for the year. As a general rule the amounts must be four equal payments.
Pay all taxes on time after closing a business, and request cancellation of the registration number.
Respond to communications from Taxing Authorities in a timely manner.

File complete and accurate tax returns is a very important obligation. This included, but not limited to:

Separate personal from business expenses. One should never run personal expenses through the business, especially a corporation.
Have documentation for all expenses. Documenting expenses during an IRS audit should never be a problem if this is part of the daily administration of a business or individual financial affair. When thinking of documentation, one should ask themselves, “will the IRS accept this documentation”.
Using the services of a tax or accounting professional, like a CPA, does not relieve the Taxpayer from understanding the accuracy of or the tax positions taken in the return. It is the Taxpayers responsibility to review all fillings carefully before signing them to verify that the information contained is true, accurate and the Taxpayer understands the tax position(s) taken.

Another important obligation is to keep accurate and complete business and personal tax records. IRS regulation section 1.446-1 requires this. The most common records are:

Business having a generally accepted bookkeeping or accounting system (QuickBooks, Sage, or other comparable systems). A spreadsheet listing income and expenses is never appropriate.
Business having complete employee files and payment records
Auto Mileage Logs
Travel and Entertainment Logs
Other recorders might require that are specific to the Taxpayer’s industry or special circumstance
When uncertain, ask us.

In addition, there is a special trust given to business in the administration of payroll and sales tax. Business are given a trustee fiduciary responsibility to collect taxes from employees and customers on behalf of Taxing Authorities and to forward these taxes to the Taxing Authorities. These taxes are called trust fund liabilities. The funds collected do not belong to the business, but to their employees and customers. Not paying these taxes is basically stealing, no different than when a trustee of an estate uses the money in the estate for their own use. Courts have held financial hardship is not an excuse in not paying trust fund liabilities to avoid criminal prosecution.

Remember by signing your tax return you are certifying to the government that your returns are true, accurate and you understand the tax position(s) taken. If, in good conscience, cannot do neither of these things, do not sign the return, but ask questions of your tax professional to make sure you have a good understanding. If your tax professional has a problem with asking questions, then get a new tax professional.

In Tax Resolution

CONGRATULATIONS! By retaining this firm, you have taken the first step in taking responsible control of your tax problems and are on the way of getting all of them behind you, like a bad dream. We are looking forward to working with you and are committed to providing the utmost in service and professionalism; however, our ability to help is limited to your commitment to resolve your problems. Your level of commitment will be measured by the following:

Your willingness to understand why and how you got in trouble with the Taxing Authorities.
Your willingness to correct the problems identified in (1) above
Your responsiveness to our suggestions and requests as professionals.

In this process we are a team and your cooperation are imperative in allowing us to protect you from the Taxing Authorities in preventing levy action and arriving at a Tax Resolution. Lack of cooperation will guarantee levy action by the Taxing Authorities and negatively affect your Tax Resolution. Also, the fee(s) listed in the Engagement Letter are quoted assuming full and complete cooperation; lack of cooperation will guarantee an increase in the total fees for our services. The following are imperative:

Bring your business and taxes in compliance for the current period in all areas including, but not limited to, tax fillings, tax payments, accounting/bookkeeping, employee records and in compliance with US

Department of labor and your state’s employment regulations [including employee/independent contractor status].

Keeping current and follow through on the Tax Resolution Game Plan.
Return our phone calls and or other communication through e-mail, the Client Portal or fax within 24 hours. It is your responsibility to make sure that you remove any hindrance in receiving our e-mails, phone calls and mail delivered by the USPO or other common courier. We have spent considerable time and resources in making sure our clients get proper communication, thus saying “I did not get your e-mail” or other communication is not an appropriate response. You might consider setting up a separate e-mail or fax machine dedicated to your tax resolution.
Meet all deadlines provided. Please refer to the “Client Duties” in the Engagement Letter.
Consult with us before making any unplanned changes in your finances, be it a change in income, expenditures, or anything else.

Because of your tax problems you are now under the microscope of the Taxing Authorities. As a result, you will need to conduct your business and financial affairs at a higher standard than most who are NOT under the Taxing Authority microscope. As a result, you might find other business or people who are conducting their affairs at a lower standard, appearing to get away with it.

Cooperation and Participation, Effect on Fees

Client and Client's management is responsible for the proper recording of transactions in the books of accounts, for the safeguarding of assets, and for the substantial accuracy of the financial records. The John Ellis Company shall endeavor to be alert to any information provided by or on behalf of Client that is incorrect or missing and shall apply its normal diligence in this regard; nevertheless, The John Ellis Company shall be entitled to rely on the accuracy, completeness, and reliability of all information provided by, and on all decisions and approvals of, Client (and Client's retained advisors, consultants, or legal counsel). Client' s management shall be solely responsible for applying independent business judgment with respect to Services of The John Ellis Company and work product (including decisions on implementation or other further course(s) of action) and shall be solely and exclusively responsible for such decisions. Further, Client is responsible for designating a qualified management-level individual to be responsible and accountable for overseeing the services provided and evaluating the adequacy and results of the Services performed. Client has the final responsibility for the income tax returns, estimated tax payments, if applicable, and positions therein; therefore, Client should review returns carefully before they are signed and filed. Client must retain records supporting the filed return(s).

Client acknowledges that in order to complete the tax returns at the agreed upon fee, Client will need to provide certain information. If Client does not complete an organizer, questionnaire or information request that The John Ellis Company provides, or if Client does not respond to any other request from The John Ellis Company for information, The John Ellis Company may use alternative procedures to obtain information necessary for The John Ellis Company to prepare and sign Client's tax returns in accordance with applicable law and professional standards. If The John Ellis Company uses these alternative procedures due to Client's failure to respond to a request, The John Ellis Company will not be responsible for any error or omission that would have been avoided had Client timely and completely responded to The John Ellis Company’s request for information. If any organizer, questionnaire, or information request is received in an incomplete format, The John Ellis Company may return the items to Client for completion or correction. The cost of tax return preparation may increase as additional time is incurred to calculate or obtain the missing information. In addition, if Client fails to provide all the information necessary to complete the tax returns or work within 3 weeks from the due date of such tax returns or the agreed-upon completion date of such work, The John Ellis Company will not be responsible for the accuracy, completeness and/or timeliness of such tax returns or work.

Management Responsibilities

The Client has an obligation to fully and accurately disclose the nature, source and extent of their Assets, Liabilities, Income and Expenses in addition to properly reporting such on all tax returns and other fillings with Taxing Authorities, including all required forms and schedules. Overstating, understating, or omitting may ultimately invalidate any agreement entered into with Taxing Authorities and doing so with intent will terminate any Agreement.

Obligation To Fully And Accurately Disclose

BEST PRACTICES IN WORKING WITH THE JOHN ELLIS COMPANY

Be Organized: Generally, we charge by the hour. If you have a lot of contributions to deduct, consider providing a simple spreadsheet with the donations listed along with documentation. This could lower your bill considerably. A client once provided a co-worker with a large box of bank statements with a belt tied around it – this is an expensive way to claim your donations!

Do not Make Assumptions: A client knew he could gift each of his kids and grandchildren $13,000 without triggering any gift tax in 2010. For 2011, he incorrectly assumed inflation had increased the gift tax exclusion to $13,500 and wasn’t expecting to pay for gift tax return preparation.

Build A Relationship: If you are comfortable with your CPA, stick with them. By working with the same CPA each year, they become familiar with your situation and can quickly spot discrepancies or big changes. One year, a volunteer preparer did not ask about a real estate property tax because he did not see a mortgage statement. A year-round CPA would have known to ask.

Consult your us in Making Decisions: In 2009, a client decided to buy two cars in one year. He wanted the hybrid tax credit, so he purchased a Toyota hybrid and a Smart Car. What he didn’t know was that Toyota hybrid no longer qualified for the tax credit. Had he consulted us, we could have advised him before the purchase and provided a list of cars that still qualified.

Do not Lie to us: It is like lying to your doctor, it only hurts you. Sometimes clients can be embarrassed to share information like gambling earnings or certain medical expenses. Your information is private and helps us to determine the best way to claim that expense or report those earnings.

Payment of Your Invoice

All invoices are due upon receipt. If we have not received payment within 7 days of our invoice, all work will be suspended until your account is brought current. All invoices remaining unpaid for more than 30 days will be subject to a monthly interest charge comparable to the average variable credit card interest rate as quoted on bankrate.com at the time the invoice becomes past due [www.bankrate.com/finance/credit-cards/current-interest-rates.aspx]
Our invoices will be rendered as the work progresses and are due and payable upon presentation. It is the responsibility of Client to review the invoice and is encouraged to ask questions and/or request explanation of the services listed. If an invoice is not questioned within 20 days, it is deemed to be correct.

All retainers and subsequent payments for services are earned when paid. No refunds will be due if this engagement is terminated by reason listed under “Client Duties” or by Client.

A reinstatement fee will be required if this agreement is terminated for any of the reasons noted in Client’s Duties.
You agree to make payment as set forth above. The Client will be charged and agrees to pay for any time or expenses spent in effort to collect on all unpaid amounts.

Your invoice can be paid by any of the following methods:

Checks. Please make checks payable to “The John Ellis Company”
Cash only upon pre-approval.
ACH debits from your US checking or saving account, please see the “Returned Check Policy Statement”. There is an additional $25.00 one-time set-up fee for reoccurring payments only.
Bank wire transfers. Contact us for wire transfer instructions.
Credit Cards (MasterCard, Visa, Discover, American Express)
Payments through PayPal. Just let us know this is your preference and we will send a request through PayPal.

Returned check service fee, California Civil Code 1719(a)

The returned check service fee is twenty-five dollars ($25) for the first check returned insufficient funds and thirty-five dollars ($35) for each subsequent check returned insufficient funds and the costs to mail notification.