Accountant forgot to list $3.4M of income on your return? You will probably still be liable for accuracy related penalties.

In the recent Woodsum  case, the Tax Court ruled that a managing director of a private equity firm could not claim the "my accountant forgot to include the $3.4M of income" defense to avoid accuracy related penalties under code § 6662(a) and § 6662(b)(2).  The Court reminded Mr. Woodsum that “Even if all data is furnished to the preparer, the taxpayer still has a duty to read the return and make sure all income items are included.”

Moral of the story: you need to read your own return before the IRS does it for you. 

Hat Tip: Tax Prof Blog