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Hourly Business Tax Preparation Engagement

Business Name:
Authorized Representative's Name:

Subject: Preparation of Business Income Tax Returns

This engagement letter confirms the understanding between you and Mehdiani Financial Management regarding the scope and terms of our services. This letter is intended to clearly define our responsibilities and your responsibilities and to supersede any prior oral or written communications relating to this engagement.

Scope of Engagement

This engagement applies to tax year(s):

We will prepare your federal and applicable state business income tax returns for the tax year(s) specified in this engagement, based solely on the information you provide. This may include, as applicable, income tax returns for corporations, S corporations, partnerships, and/or limited liability companies. We will depend on you to provide all information necessary to prepare complete and accurate returns. We may request clarification of certain items, but we will not audit, examine, or independently verify the data you submit.

Our services are limited to tax return preparation. This engagement does not include financial planning, bookkeeping, financial statement preparation, legal advice, representation before taxing authorities, forensic or investigative procedures, or ongoing monitoring of tax law changes unless separately agreed to in writing.

We will perform services only as needed to prepare your tax returns. Our engagement should not be relied upon to disclose errors, fraud, defalcations, or other illegal acts. However, we will inform you of any material errors, fraud, or other illegal acts that come to our attention during the course of this engagement.

This engagement applies only to the tax year(s) stated above and does not extend to future years.

Service Fees and Payment Terms

Fees for our services are billed at a rate of $400 per hour plus out-of-pocket expenses. An upfront retainer may be required before work begins. The retainer amount is determined based on our initial assessment of the complexity and involvement of your return and, for returning clients, may be based on prior-year fees. The retainer is not an estimate of total fees. Services rendered will be billed against the retainer. Any additional fees incurred after the retainer is exhausted are due immediately upon invoicing. We reserve the right to withhold delivery or filing of tax returns until all invoices are paid in full. Accounts not paid within thirty (30) days may accrue interest to the extent permitted by law.

Important Timing, Deadlines, and Extension Policy

An extension of time to file extends only the filing deadline, not the time to pay. Any tax not paid by the original filing deadline may be subject to penalties and interest assessed by the taxing authorities. The law imposes penalties when taxpayers underestimate their tax liability. Please contact us if you have concerns regarding estimated tax payments or underpayment penalties.

To allow sufficient time for proper preparation and review, we generally require a substantially complete set of tax documents and payment of the required retainer no later than six (6) weeks before the applicable filing deadline. Clients are encouraged to upload documents as they become available. Certain items, such as Schedule K-1s, may be submitted later, provided all other required information has been received by this internal deadline.

In some cases, a return may still require an extension due to complexity, late-received information, capacity constraints, or additional review requirements. The determination of whether an extension is required rests solely with our firm.

If an extension is required, we can assist with calculating an estimated extension payment based on the information available at the time. Extension payment calculations and related analysis are billed separately at our standard hourly rates and are subject to our internal document deadlines. If sufficient information is not available, we may recommend using the prior year’s tax liability as a reference point, adjusted for known or expected changes.

For returns filed under extension, all remaining documents other than pending Schedule K-1s must be provided no later than eight (8) weeks before the extended filing deadline to allow for timely completion.

Timely filing is not guaranteed if required information, approvals, or payments are not provided within firm deadlines.

Expedition and Late Submission Policy

Documents submitted after our internal deadlines may require expedited handling. At our discretion, an expedition fee starting at $250 may apply. Expedition fees are non-refundable and do not guarantee completion or filing by any specific deadline. We reserve the right to decline expedited work if timing, complexity, or capacity does not permit.

Client Responsibilities

To ensure accurate and timely tax preparation, you agree to the following:

Provide Complete and Accurate Information
You are responsible for providing complete, accurate, and organized information necessary to prepare your business tax returns. This includes all income, deductions, credits, asset purchases and dispositions, ownership changes, and other relevant tax items. You must provide complete financial statements, including income statements, balance sheets, and any supporting schedules necessary to accurately report business activity.
Provide Documents on a Timely Basis
You agree to provide tax documents and information by our internal deadlines. Information provided after those deadlines may require an extension, may be subject to expedited or rush fees, and may result in your return not being completed by the applicable filing deadline.
Submit a Completed Tax Organizer and Questionnaires
A Business Tax Organizer is available on our website or may be provided to you. The organizer is designed to help avoid overlooking important information and to promote efficient preparation of your return. If a completed organizer is not provided, we will not be responsible for omitted or incomplete information that would have been identified through its completion, and additional fees may apply for extended communications or efforts to obtain missing information.
Disclose Items Commonly Overlooked
You agree to specifically disclose items that frequently affect business tax filings, including but not limited to:
• ownership changes or equity transactions
• shareholder or partner basis information
• loans to or from owners
• related-party transactions
• digital asset or cryptocurrency activity
• foreign operations, ownership, bank accounts, or reporting obligations
• multi-state activity or nexus considerations
• notices received from taxing authorities
• business formations, acquisitions, restructurings, or closures
• large asset purchases, sales, or dispositions
Report Material Changes Promptly
You agree to notify us promptly of any material change that could affect your return, including changes to ownership, officers, business address, entity classification, accounting method, or operational structure.
Respond Promptly and Cooperate With Requests
You agree to respond to our questions and requests for information within three to five (3–5) business days. Delays may result in extensions, increased fees, or delayed completion.
Review and Approve the Return Before Filing
You are responsible for reviewing the completed returns for accuracy before approving them for filing. Your approval, whether written or electronic, authorizes us to file the returns as prepared. Failure to review does not shift responsibility to our firm.
Provide Signatures, Authorizations, and Payment Information
You agree to timely sign all required e-file authorizations and provide any required payment or direct debit information. Returns will not be filed until authorization is received and all outstanding invoices are paid in full.
Additional Work Due to Late or Revised Information
If new, revised, or corrected information is provided after we have substantially completed your return, additional fees may apply and filing may be delayed.
Retain Records
You are responsible for maintaining copies of all source documents, supporting schedules, and filed returns. Our record retention policy is described below.

Electronic Filing and Authorization

Our engagement concludes upon delivery of the completed returns to you (for paper filing) or upon your authorization and our submission of the returns (for electronic filing). If you elect not to e-file through our office, you are solely responsible for filing the returns with the appropriate taxing authorities.

Electronic Communication and Data Privacy

We may communicate with you and exchange documents using email and cloud-based systems. Electronic communications may be intercepted or misdirected. Accordingly, we disclaim any liability for interception or unintentional disclosure of email communications and shall have no liability for any loss or damage arising from the use of electronic communications.

Records Retention

We will return your original records at the conclusion of this engagement. We retain copies of your records and our work papers for seven (7) years, after which they may be destroyed without notice. We have no obligation to retain records beyond this period.

Legal Process, Indemnification, and Limitation of Liability

If we are required to respond to a subpoena, court order, or other legal process related to this engagement, you agree to compensate us at our standard hourly rates and reimburse us for all related out-of-pocket costs, including attorney fees.

You agree to indemnify, defend, and hold us harmless from any costs, penalties, settlements, judgments, or claims arising directly or indirectly from inaccurate or incomplete information you provide.

Our liability for any claim arising out of this engagement, whether in contract, tort, or otherwise, is limited to the fees paid for the services giving rise to the claim, except in cases of willful misconduct.

Dispute Resolution and Governing Law

Any dispute arising from this engagement, other than actions to collect unpaid fees, shall first be submitted to mediation in Los Angeles County, California. Any litigation shall be brought exclusively in that jurisdiction and must be commenced within one (1) year from the accrual of the cause of action.

Termination and Entire Agreement

Either party may terminate this engagement at any time with written notice. All fees incurred through the date of termination are due immediately.

This engagement letter constitutes the entire agreement between the parties and supersedes all prior oral or written agreements or understandings. Any modification must be in writing and signed by both parties.

Acknowledgment

This engagement applies only to the tax year stated above. A new engagement letter is required for each subsequent tax year.

By signing below, you acknowledge that you have read, understand, and agree to the terms of this engagement.

Sincerely,

Alan Mehdiani, CEO
Mehdiani Financial Management
9025 Wilshire Blvd, Suite 301
Beverly Hills, CA 90211
info@mehdiani.com
www.mehdiani.com

Section 7216 - Consent to Disclosure of Tax Return Information

Mehdiani Corporation dba Mehdiani Financial Management ("Mehdiani US") and Subsidiaries is a tax firm that services clients both domestically and internationally. To effectively serve all of our client's tax needs, we rely on a global team of tax professionals to ensure your tax returns are prepared in compliance with US and international tax laws. As required under US Federal law and IRS Code, we request your consent to disclose the tax return information you provide us with our international tax team. The IRS requires that the following paragraphs be included in any consent form of this type. Signing this consent form will not result in the disclosure of your personal information to anyone for any reason other than the preparation and filing of your returns.

Federal law requires this consent form be provided to you. Unless authorized by law, we cannot disclose your tax return information to third parties for purposes other than the preparation and filing of your tax return and, in certain limited circumstances, for purposes involving tax return preparation. If you consent to the disclosure of your tax return information, Federal law may not protect your tax return information from further use or distribution. You are not required to complete this form. Because our ability to disclose your tax return information to another tax return preparer affects the service that we provide to you and its cost, we may decline to provide you with tax preparation services or change the terms of service that we provide to you if you do not sign this form. If you agree to the disclosure of your tax return information, your consent is valid for the amount of time that you specify. If you do not specify the duration of your consent, your consent is valid for one year. This consent to disclose may result in your tax return information being disclosed to a tax return preparer located outside the United States, including your personally identifiable information such as your Social Security Number (“SSN”). Both the tax return preparer in the United States that will disclose your SSN and the tax return preparer located outside the United States that will receive your SSN maintain an adequate data protection safeguard (as required by the regulations under 26 U.S.C. Section 7216) to protect privacy and prevent unauthorized access of tax return information. If you consent to the disclosure of your tax return information, Federal agencies may not be able to enforce US laws that protect the privacy of your tax return information against a tax return preparer located outside of the US to which the information is disclosed.

By signing below, you agree to allow Mehdiani US to disclose your tax return information, including your SSN(s), to Mehdiani (Philippines Office), ("Mehdiani PH") for purposes of providing assistance in the preparation of your tax returns and other forms. This consent will be valid for seven years from the date of signature unless you prefer an earlier expiration date which can be accommodated by contacting our office. If you have any questions regarding this disclosure, please do not hesitate to contact us by telephone at 310-800-1472, or by email at info@mehdiani.com.

If you believe your tax return information has been disclosed or used improperly in a manner unauthorized by law or without your permission, you may contact the Treasury Inspector General for Tax Administration (TIGTA) by telephone at 1-800-366-4484, or by email at complaints@tigta.treas.gov.

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January 29, 2024 3:56 pm PST

Hourly Business Tax Preparation Engagement Uploaded by Emilse Bernal - info@mehdiani.com IP 98.148.6.8

January 29, 2024 4:03 pm PST

Document owner alan@mehdiani.com has handed over this document to info@mehdiani.com 2024-01-29 16:03:35 - 98.148.6.8