A tax practitioner can be vicariously liable for which of the following?

A tax practitioner can be vicariously liable for which of the following?

• A. Acts of Clients
• B. Acts of Their Employees or Fellow Partners in a Partnership
• C. Acts of Competitors
• D. Acts of Third Parties Not Under Control

Answer: (B)

Vicarious liability in professional practice means you’re responsible for the actions of people who work for you or with you in delivering the service. For a tax practitioner, the firm can be liable for what its staff do and for what fellow partners do when they’re carrying out the partnership’s business, because those people are acting as agents of the firm. If an employee makes an error or a partner acts within the ordinary course of the partnership’s work, the partnership can be liable for those acts. That’s why the correct answer is acts of their employees or fellow partners in a partnership. Acts of clients are not acts of the practitioner, so they don’t make the practitioner vicariously liable. Acts of competitors are outside the practitioner’s control, and acts of third parties not under control aren’t vicariously liable unless there’s an agency relationship.

Vicarious liability in professional practice means you’re responsible for the actions of people who work for you or with you in delivering the service. For a tax practitioner, the firm can be liable for what its staff do and for what fellow partners do when they’re carrying out the partnership’s business, because those people are acting as agents of the firm. If an employee makes an error or a partner acts within the ordinary course of the partnership’s work, the partnership can be liable for those acts. That’s why the correct answer is acts of their employees or fellow partners in a partnership.

Acts of clients are not acts of the practitioner, so they don’t make the practitioner vicariously liable. Acts of competitors are outside the practitioner’s control, and acts of third parties not under control aren’t vicariously liable unless there’s an agency relationship.