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I would spend the time to make internal note outlining the situation, what you did on termination, and what possible complications (and if known, solutions) for the future. All while fresh, in case something comes back a couple years later.

Yuck. This is an issue with opinion-based services (with little chance of bad or dark gray opinions getting caught). Same with a tax preparer helping get withholding to the liability amount, say to make their net meet expenses every month, and then getting fired for not getting a "fat" refund. I have been fired so many times I have lost count! I still, to this day, get into it with CPA types who do incorrectly tell my customers something. The most common examples are owner/shareholder who are also employees. CPA or other "expert" says to pay themselves wages once a quarter/year (the expert later cleans up all the "draws"), or report >2% S Corp health insurance once a year. The former do get caught "tax shifting" from time to time, the latter never get caught because it is a tax wash, but still improper. I remember doing the math for ERC to present it, and some would look at me sideways when I pointed out the ERC $ was not what the net would be. Funny, I am still ticked at the after the fact claw back of the last ERC quarter to help fund the recovery act money. Catch-22, some of the money went to rehab two race tracks I like to watch, those tracks are not going to give me a discount to cover the ERC I lost to help pay for their "gift". I thought I would personally get at least some via recovery act credits for solar and electrical upgrades, but CA has made solar a non-starter for me, given my age, roof size, and ability to shift loads to off peak.

Yes, I would send a letter confirming the termination of your services. If you have not already done so in writing, I would advise your former client to file the 2023 Form 1120 S and the amended tax returns that you prepared. In addition I would make sure that all original documents have been returned. Yes situations like this are depressing. I am currently in the midst of ending my relationship with my third largest business client which started in July 1993.

This one is marked final, and consists of various losses from the previous year. The long-term capital loss is over $4000, which is more than the $3000 limit. However, none of the beneficiaries (2) have LTCL over $3000, so I gather from previous comments that each beneficiary can get their entire loss rolled forward into this year. Admittedly, I am not very experienced with Estate returns and would not have accepted this, except it is my brother's estate.

I always wonder about these. How did it take so long to stop? I can see 12-18 months until an employee files their own return, and failing to match up with an employer depositing, but four tax years? And hopefully for the person or persons who had and access to the bank account(s), they did not get caught up in the fraud, or maybe they took a deal themselves. We used to have 941M for those caught not doing things properly, now we don't. We used to have to report W4 forms which did not seem right, now we don't. Remember, WH deposits are not on a time basis, WH on Dec 31 paycheck is like having a baby or getting a spouse on Dec 31, it is "good" for the entire year, so some avail of this strategy.

"Barry Lee White, a former business owner, has been sentenced to one year and 10 months in federal prison for willfully failing to pay more than $2.4 million in payroll taxes. White, who operated I-Bar Construction, Inc. and T-Line Construction, LLC., withheld over $1.8 million in payroll taxes from his employees between 2015 and 2018 but failed to remit the funds to the IRS. As the sole operator of the companies, White was responsible for collecting, accounting for, and paying payroll taxes, which included Social Security, Medicare, and federal income taxes. In addition to the employee taxes, he failed to pay more than $600,000 for the employer’s portion of Social Security and federal unemployment taxes. White pled guilty to the charges on May 7 and was ordered to pay $2,499,473 in restitution. Following his prison term, he will serve three years of supervised release."