What should I do if a prior preparer may have diverted part of my refund?

Question

AcadiFi · Accepted Answer

Start by separating the money trail from the tax calculation. Refund diversion suggests an authorization problem, but the filed return may also contain false deductions, credits, or filing-status claims that created the refund in the first place.

A clean workflow is:

```mermaid
flowchart TD
    A["Suspicious refund pattern"] --> B["Obtain return copy and account transcript"]
    B --> C["Identify refund amount and deposit method"]
    C --> D["Compare filed items to client records"]
    D --> E["Preserve bank, authorization, invoice, and message records"]
    E --> F["Evaluate complaint affidavit path"]
    E --> G["Evaluate return correction and notice response"]
```

At a study level, Form 14157 is used for a preparer complaint, while Form 14157-A is the affidavit path commonly tied to alleged preparer fraud or misconduct affecting a return or refund. The client may also need a refund trace or missing-refund inquiry, depending on the facts and current IRS instructions.

Do not promise that a complaint will erase the tax problem. If the prior return claimed deductions or credits the taxpayer could not substantiate, the representative still needs to reconstruct the correct return and protect any notice deadline.

What should I do if a prior preparer may have diverted part of my refund?

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