Errors and Omissions Insurance for Tax Professionals
Benjamin Franklin once stated, “The only things certain in life are death and taxes.” If you are a tax preparer, you have the job security of knowing your services will always be needed. Many tax preparers go into business for themselves, which offers more freedom and oftentimes more money than they would make working through a company.
Tax Preparers Insurance–What You Need
As with any business, liability insurance is a must and frequently required by most state laws in order to obtain a business license. Errors and omissions insurance for tax professionals is the main type of liability coverage you will need. Also referred to as professional liability insurance, this tax preparers insurance provides coverage for professionals should they be sued for mistakes they make in their work.
What exactly does tax preparers insurance cover? Let’s say one of your clients contacts you after you prepare and file their taxes only to inform you they owe a significantly higher amount than you originally anticipated. Your client decides to sue you for this, and you face a court battle that involves a large sum of legal fees. Another liability example tax preparers often face occurs when a client is audited and a number of errors are found in his or her return. Errors and omissions insurance for tax professionals will cover your legal defense as well as any judgments found in your clients’ favor, up to the limits of your policy.
Tax Preparers Insurance–How Much?
The amount of professional liability insurance you will need to purchase depends on your client load. If you only have a few clients, $100,000 per occurrence is a good starting point and will run an average of $300 each year. If you have a number of clients or your clients include companies that have more money at stake than the average individual, coverage of $1,000,000 per occurrence is a better place to start.
Errors and omissions insurance for tax professionals is relatively affordable, with coverage of $1,000,000 running an average of $650 per year, so it makes sense to get the most insurance you can afford.
Finding Tax Preparers Insurance
Insurance companies that specialize in business insurance can provide you with liability coverage for your business. The best way to get it at an affordable rate is to shop around and compare quotes from numerous companies. This can be time consuming, unless you use a site like netquote.com. Netquote has a wide range of information for tax professionals that will make finding the coverage you need and knowing how much to purchase simple. Then, you can find multiple tax preparers insurance quotes for free.
See how much you could save today on your insurance. Get your free business insurance quotes today!