Tax Services Agreement
Last Updated: 5/30/2024
This Tax Services Agreement is between Haven Business Corporation (“we”, “our”, “us”) and each business that subscribes to the Tax Preparation Services or research and development (“R&D”) Credit Services, each as defined below (the “Company”, “you”, “your”). This Tax Services Agreement applies to our tax services and operate in addition to the terms of the Haven Terms & Conditions. If there is an express conflict between the Tax Services Agreement and the Haven Terms & Conditions, the Tax Services Agreement terms control. Terms defined in the Haven Terms & Conditions and used in these Tax Services Agreement without definition have the meaning given to them in the Haven Terms & Conditions.
The written Engagement Letter(s) executed by you and us, including any scope(s) of work appended thereto (the “Engagement Letter”) together with the Haven Terms & Conditions and this Tax Services Agreement are referred to herein as the “Agreement”. The Effective Date of this Agreement is the date that the first Engagement Letter has been signed by both you and us. If the Engagement Letter contains additional terms and conditions, then those terms and conditions govern to the extent they conflict with any term and conditions in this Tax Services Agreement.
The purpose of the Agreement is to establish the terms of our engagement and the services we will provide.
IRS Regulation 26 C.F.R. § 301.7216-3 consent to disclosure and use
You acknowledge that we may perform any or all of our obligations hereunder through a third-party tax filing preparer service provider or a third-party R&D tax services provider, including in each case its Affiliate(s), some of which may be located outside of the United States (each service provider and its Affiliates, a “Service Provider”) and/or our Affiliate(s), some of which might be located outside of the United States. These Service Providers and/or we and our Affiliates may use subcontractors, some of which may be located outside of the United States. You acknowledge that we will provide tax services only if and upon your completion of a validly executed IRS Regulation 26 C.F.R. § 301.7216-3 Consent to Disclosure and Use form in which you consent to allow us to disclose certain tax information as specifically described therein for such period until you are no longer using our tax services. You understand and acknowledge that we will not provide tax services until such consent is executed and provided to us in your Engagement Letter.
I. Services
Tax Preparation Services
If you purchase our tax preparation services (as reflected on your Order Form), we expect to perform the following services (the “Tax Preparation Services”):
Prepare the federal, state(s), and local income tax returns with supporting schedules and additional filings listed on the Engagement Letter, based on financial statements provided by the Company.
Any additional tax returns or other government filings for the Company not included in the Engagement Letter must be requested in writing by the Company, and accepted in writing by us, and will then be subject to the terms and conditions of this Agreement.
Except as specifically provided in an Engagement Letter, this engagement and the Tax Preparation Services do not include any returns other than income tax returns (including without limitation sales or use tax returns) and do not extend to determining the Company’s filing requirements or nexus in any particular taxing jurisdiction.
We and the Service Provider must use judgment in resolving questions where the tax law is unclear, or where there may be conflicts between the taxing authorities’ interpretations of the law and other supportable positions. We and the Service Provider may apply the “more likely than not” reliance standard when communicating positions to you to resolve such issues in order to avoid penalties that might be assessed against the Service Provider as a return preparer. As a condition of receiving Tax Preparation Services, you agree to honor our reasonable directions and those of the Service Provider regarding disclosure of return positions to avoid or mitigate penalties.
In the course of the Tax Preparation Services, it may come to your or our attention that you may need to file tax returns in one or more additional jurisdictions, including foreign jurisdictions. While we will advise you if this comes to our attention, you remain solely responsible for identifying all filings for which you are seeking Tax Preparation Services, including any liability and additional expenses resulting from choosing not to prepare and file any tax returns, tax forms, and/or supporting schedules (whether recommended by us or not). You must inform us of any new or expanded activities that could trigger filing requirements in additional state(s) or country(ies), such as the acquisition of property or the hiring of employees or use of independent contractors in a new state or country. Activities of a partnership, LLC, trust or other pass-through entity in which you are an owner or beneficiary may also trigger additional state and/or foreign tax filings, so you must inform us if you have acquired an interest in a new pass-through entity over the past year. We will not file any Commerce Department reports or surveys for the Company.
Management is responsible for ensuring proper recording of transactions in the accounts, safeguarding assets, and for the substantial accuracy of the financial records. Because you have final responsibility for the tax returns, you should review them carefully before you sign and file them. Your returns may be audited by the taxing authorities. Any proposed adjustments may be subject to appeal.
Because of the special purpose, nature and format, income tax returns do not constitute financial statements prepared in accordance with generally accepted accounting principles. The tax returns should be used only for income tax purposes and must not be used as a substitute for financial statements.
R&D Credit Services
If you purchase our R&D tax credit services (as reflected on your Engagement Letter), we will provide the following services (“R&D Credit Services”):
Provide guidance to identify and determine which of the Company’s expenses qualify for the R&D tax credit for United States federal income purposes;
Calculate the amount of the Company’s qualifying R&D expenses and provide the Company such calculation;
Prepare supporting technical and financial substantiation documentation required for IRS Forms 6765 and 8974 (including, but not limited to, documentation of research time and R&D payroll expenses) (together with the calculation of the Company’s qualifying R&D expenses, the “R&D Tax Credit Study”)
We and the Service Provider must use judgment in resolving questions where the tax law is unclear, or where there may be conflicts between the taxing authorities’ interpretations of the law and other supportable positions. We and the Service Provider may apply the “more likely than not” reliance standard to resolve such issues in order to avoid penalties that might be assessed against the Service Provider as a return preparer. As a condition of receiving R&D Credit Services, you agree to honor our reasonable directions and those of the Service Provider regarding disclosure of return positions to avoid or mitigate penalties.
The Company is responsible for ensuring proper recording of transactions in the accounts and for the completeness and substantial accuracy of the financial, personnel and R&D records. Because you have final responsibility for the tax returns, you should review them carefully before you sign and file them.
There is no guarantee that the taxing authorities will accept your R&D activities as qualifying R&D activities or that the tax authorities will approve all of your R&D expenditures as qualifying R&D expenditures. Additionally, your returns may be audited by the taxing authorities. Any proposed adjustments may be subject to appeal.
We provide the Services at the direction and for the benefit of your management
We provide the Services at the request of, and under the direction of, your management. Your management is responsible for all management decisions and performing all management functions, including (i) setting policies or accepting policy recommendations; (ii) evaluating the reasonableness of underlying assumptions and the adequacy and results of the Services; and (iii) implementation of any findings or recommendations resulting from the Services. We may act upon, and will not have liability for acting upon, instructions in any form (e.g., electronic, written, oral) so long as we reasonably believe that the instructions were actually given by you or on your behalf. You are responsible for the legality of your instructions to us. We are not obligated to identify or offer additional Services.
We prepare deliverables resulting from the Services (for example, excerpts, models, budgets, confirmations, etc.) for use by your management. Your management is responsible for reviewing all deliverables resulting from the Services. In preparing deliverables, you agree that we (a) do not have an obligation to independently verify the accuracy or completeness of any facts provided by you or any third party, and (b) do not undertake to update the deliverable if any facts change, unless the Engagement Letter for the services expressly states otherwise. If you elect to present any deliverable to any third party, such presentation must be made solely by you and not by or on behalf of us, and you agree to remove any references to us from the deliverable and/or from the presentation.
We need and rely on information from you
Our provision of the Services requires that you provide us access to corporate, financial and related information, information technology systems or services, and/or input from you. You agree to timely provide all such information, access and input and reasonably cooperate with us in our provision of the Services. You agree to provide good faith assumptions and accurate and complete representations, information and data, and you agree that we may assume you have done so without further investigation or verification. You agree that late or insufficient information, access or input from you may cause delay in the performance of the Services, inability to provide the Services, or increase in the amount of our fees.
For the avoidance of doubt, if our performance of the Services is prevented or delayed by any act or omission by you or your agents, vendors, consultants, or employees, we will not be in breach of our obligations or otherwise liable for any related costs, charges, or losses incurred by you.
Haven Business Corporation is not a certified public accounting firm
You understand and agree that Haven is not a certified public accounting firm and does not provide services that would require a license to practice public accounting. You acknowledge that Haven is not a member of the American Institute of Certified Public Accountants (AICPA) and is not governed by any AICPA rules. The Services do not include, and you will not rely on them for: (i) audit, attest, examination or review of financial transactions or accounting records (as such terms are used in the New York Business and Professions Code Section 7401 et seq. (“New York Public Accountancy Law”)); (ii) independent advice relating to accounting procedure or to the “recording, presentation, or certification of financial information or data” within the meaning of the New York Public Accountancy Law; (iii) preparation or certification of reports on audits or examinations of books or records of account, balance sheets, and other financial, accounting and related schedules, exhibits, statements, or reports that are to be used for publication, for the purpose of obtaining credit, for filing with a court of law or with any governmental agency, or for any other purpose, as contemplated by the New York Public Accountancy Law; (iv) legal or regulatory advice regarding any of your business practices, including with respect to their appropriateness or legality; or (v) unless otherwise expressly included on an Engagement Letter and only those services expressly included in an Engagement Letter, tax advice or tax return preparation (although we will provide bookkeeping assistance to your tax preparer). You should seek the services of a duly licensed professional in connection with any of the foregoing. In particular, in compliance with applicable law and accounting standards regarding auditor independence, we cannot (and do not) make any representation or warranty whether any financial records are compliant with GAAP, IFRS or any other accounting standards or rules.
II. Records
III. Fees
R&D Credit Services
- If, based on the completed R&D Tax Credit Study, the results of our calculations indicate that you are not eligible to claim any R&D tax credits, you will be entitled to a full refund of your initial payment.
- If, based on the completed R&D Tax Credit Study, the results of our calculations indicate that the amount of R&D tax credits that you are entitled to claim is less than the amount of your initial payment, you will be entitled to a partial refund equal to the difference between the amount of your initial payment and the amount of R&D tax credits our calculations indicate you are eligible to claim.
There is, however, no guarantee that the taxing authorities will accept your R&D activities as qualifying R&D activities or that the tax authorities will approve all of your R&D expenditures as qualifying R&D expenditures.
IV. Rights and Protections
The Company agrees to indemnify, and hold harmless, us, each Service Provider and each of our and their officers, directors, employees, contractors, Affiliates and agents for any liabilities, damages, expenses (including reasonable attorney’s fees and costs), costs and/or losses incurred in connection with (a) any financial liability for penalties or interest resulting from misinformation or misdirection originating from Company or failure by Company to timely provide required information, sign e-file forms or make necessary payments and/or (b) any third party claims or other legal or regulatory action or proceeding involving or relating to the Tax Preparation Services, R&D Credit Services or this Agreement. With respect to any action or proceeding in which we are not a party, the Company shall indemnify, and hold harmless, us, each Service Provider and each of our and their officers, directors, employees, Affiliates, and agents for all costs and expenses (including reasonable attorney’s fees and costs) associated with providing testimony, documents or information relating to the Tax Preparation Services and/or R&D Credit Services, including any time expended at our (or an applicable Service Provider’s) then standard rates.
We and the Company, to the extent permitted by applicable law, each knowingly, voluntarily and intentionally waives the right to a trial by jury in any action arising out of or relating to this Agreement, the Tax Preparation Services or the R&D Credit Services to be performed by us pursuant hereto. This waiver applies to any action or legal proceeding whether sounding in contract, tort, negligence or otherwise. This Agreement and all claims relating to the relationship between the parties are governed by the laws of New York, U.S.A, without regard to conflict of law principles. The arbitration provisions of Section 11 of the Haven Terms & Conditions shall apply to the resolution of any dispute under this Agreement, unless you have opted out as provided in the Haven Terms & Conditions.
V. Confidentiality
- The first sentence of the definition of Confidential Information shall read: “(i) “tax return information” as defined in Treasury Regulation § 301.7216-1(b)(3), and (ii) other non-public information that is marked as confidential or would normally be considered confidential information under the circumstances.”
- The IRS Regulation 26 C.F.R. § 301.7216-3 consent to disclosure and use in your Engagement Letter shall operate in lieu of the authorization to disclose Confidential Information to Delegates in Section 3.2 of the Haven Terms & Conditions.
VI. Miscellaneous
The Agreement constitutes the entire agreement between you and us with respect to its subject matter, and supersedes any and all prior agreements, discussions, negotiations and offers.
If one or more of the provisions contained in this Agreement is held invalid, illegal or unenforceable in any respect by any court of competent jurisdiction, such holding will not impair the validity, legality, or enforceability of the remaining provisions. You may not assign this Agreement, or your rights or obligations under it, in whole or in part. We may freely assign this Agreement, or its rights or obligations under it, in whole or in part.