Posted on: October 28, 2025 by Huntersure
Missing a tax deadline might seem like a minor slip. But for midsize to large accounting firms, it can trigger much larger consequences. The size of their client accounts, the complexity of services they offer, and the pressure to get everything right make even minor mistakes risky.
In this blog, we’ll explore claims scenarios that highlight how a missed deadline or misstep can lead to serious professional liability issues. You’ll also see why tailored coverage can help protect firms from these exposures.
Yes, and more often than you might think. The federal tax code is dense, ever-changing, and often unforgiving. Even a single missed form can trigger an audit, a financial penalty, or worse: a lawsuit claiming professional negligence.
And the trend isn’t slowing down. According to the Journal of Accountancy, claims involving late filings jumped from 25% in 2022 to 37% in 2023. That kind of jump is worth paying attention to.
What’s more, clients sometimes expect outcomes that no accountant can truly guarantee. If a filing backfires or a deduction is denied, they don’t just blame the Internal Revenue Service (IRS). They also hold their advisor responsible.
These misunderstandings drive many exposures for midsize to large accounting firms, especially within tax advisory and consulting practices. As the IRS sharpens enforcement and clients face higher financial stakes, agents need to understand how simple errors can evolve into high-value claims.
Some liability risks come up repeatedly. Below are three claims scenarios agents should watch for in accounting practices.
Late or incomplete submissions can lead to IRS fines or lost deductions. Even when incomplete client documentation caused the delay, accounting firms may still be held accountable for the outcome. In these cases, the presence (or absence) of a clear engagement letter can play a major role in how the claim is resolved.
If an audit uncovers material issues that were not previously identified, firms may be accused of negligence. Sometimes, investors or board members file suit, claiming that a flawed financial opinion caused reputational or monetary damage.
Many accounting firms expand their services to include tax structuring and implementation. When this advice leads to unexpected regulatory scrutiny or financial loss, the line between recommendation and execution can blur. That’s where liability exposure grows.
Pro tip: If a client insists that their accountant “guarantee” a specific tax result, that’s a warning sign. Unrealistic expectations like this can easily become the root of a future claim.
For accounting firms, missed deadlines are never just clerical errors. They’re liability exposures that can harm reputations, trigger financial loss, and leave clients exposed.
As an agent, your role is to help clients prepare for these risks before they happen. That means working with a partner who knows how to customize professional liability protection for today’s exposures.
Huntersure supports brokers with:
With deep experience across tax, audit, and consulting lines, our underwriting teams help agents build programs that address real-world risks. That includes protection for claims tied to missed deadlines, consulting advice gone wrong, or audit-related disputes.
Partner with Huntersure today to help your accounting clients avoid preventable claims and gain confidence in their coverage.
Huntersure LLC is a full-service Managing General Agency that has provided insurance program administration for professional liability products to our partners across the United States since 2007. We specialize in providing insurance solutions for businesses of all sizes. Our program features can cover small firms (grossing $2.5 million annually) to large corporations (grossing $25 million annually or more). We make doing business with us easy with our breadth and depth of knowledge of E&O insurance, our proprietary underwriting system that allows for responsive quoting, binding, and policy issuance and tailored products to meet the needs of your insureds. Give us a call at (855) 585-6255 to learn more.
Posted in: Accountant Professional Liability Accountants
