Question

Maggie wants her tax refund quickly; however, she doesn't have a bank account for direct deposit. She asks Josh, the tax law-certified preparer, to deposit her refund into his checking account and turn the funds over to her when received. If Josh agrees to do this, has he violated any of the Volunteer Standards of Conduct?

1) Yes
2) No

Answer 1

Yes, Josh has violated the Volunteer Standards of Conduct by agreeing to deposit Maggie's tax refund into his own checking account, as this could be seen as unethical and puts the client's funds at risk.

Step-by-step explanation:

If Josh, the tax law-certified preparer, agrees to have Maggie's tax refund deposited into his own checking account and then turns the funds over to her, he has indeed violated the Volunteer Standards of Conduct. The IRS's guidelines for tax preparers are quite clear that preparers must maintain a high level of professional ethics, which includes respecting clients' confidentiality and avoiding any actions that could constitute a conflict of interest or fraud.

Depositing a client's refund into a personal account could be seen as a misstep in ethical judgment and could potentially put the client's funds at risk, which is not in line with the integrity expected of a certified tax preparer.

The Volunteer Standards of Conduct for tax law-certified preparers prohibit them from directly or indirectly receiving the taxpayer's refund or charging a fee based on the amount of the refund. By depositing Maggie's refund into his own account and then transferring it to her, Josh would be indirectly receiving the refund, which is against the conduct standards.