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MEMBERSHIP AGREEMENT

CryptoTaxAudit will automatically bill you for your monthly membership to keep your coverage from lapsing. You can cancel your membership by contacting us via email ([email protected]), from within your membership dashboard on the CryptoTaxAudit.com website, or by failing to pay the monthly membership.

CLARIFICATION OF TERMS

In this agreement, "you" and "your" refer to the member(s) shown on the membership certificate. "We," "us," and "CryptoTaxAudit" refer to Donnelly Tax Law, the company providing audit defense services. "IRS" refers to the Internal Revenue Service, and "State" refers to your state or local income tax authority.

    • Audit: An audit, also called an examination, is an inspection of an individual’s or an entity’s books and records. In addition, an audit involves the questioning of witnesses to determine the individual’s or entity’s correct tax liability. A collections or enforcement letter is not an audit. A CP2000 letter is not an audit or an audit flag.
    • Audit Flag: When the IRS places a transaction code 420, 424, or 922 on a member’s account transcript, that is an audit flag.
    • Acceptance Date: Acceptance Date is the date that we receive your initial payment for a monthly membership. If monthly payments lapse, then the date the payments restart is considered the new acceptance date.
    • Case: A case begins with a client signing our engagement letter to represent them on an audit. A case concludes when the tax authority closes their audit and you agree to no further escalation of the case beyond the Appeals office level.
    • CP2000 Letter: An IRS CP2000 letter is not an audit, examination, or an audit flag. This letter is issued when a tax return fails to account for all the wage and income information (1099, W-2, K-1) that was reported to the IRS. We can assist in preparing a response for an additional fee.
    • Expiration Date of Membership: The Expiration Date of Membership is fifteen days after a missed monthly membership payment. If the membership cancelation was sent via email to [email protected], then the cancelation date is the date the email was received.
    • Membership Period: Membership Period is the period commencing with the Acceptance Date. The final day of the Membership Period is the Expiration Date of Membership or the date you cancel the membership. Once the Membership Period expires, all work on any open audit cases will cease, and we will cancel any IRS or State representation agreement.
    • Membership Level: The level of the Membership is determined by the monthly payment amount signed up and paid.
    • Case Manager: The Case Manager is your CryptoTaxAudit primary contact assigned to your audit case.

CONFIDENTIALITY

Your name, address, and any other personal information will not be disclosed or sold to any persons or firms outside of the tax authorities. Only CryptoTaxAudit staff will have access to your tax information.

We may use your name and email to contact you about Membership benefits and changes to terms.

ALERT MEMBERSHIP SERVICE

We will check your IRS account weekly to see if any audit flags have been added. We will send you an email notifying you if an audit flag is set.

You are responsible for authorizing CryptoTaxAudit to communicate with the

IRS on your behalf. You agree that the limit of our IRS authorization (IRS Form 2848) is to notify you of audit flags. You understand that it takes the IRS several weeks to process the initial authorization before starting to check audit flags.

TRANSCRIPT MEMBERSHIP SERVICE

In addition to providing the Alert Membership Service to you, we will provide you with the following documents derived from your IRS account records:

    • An initial IRS transcript summary (usually 15-40 pages long) after the IRS processes the authorization. It will be updated monthly thereafter if there are any changes.
    • Once the IRS releases their wage & income transcript information for the prior year (usually in the month of June), we will send you a copy of this transcript.
    • Upon demand, an IRS record of account transcript will be provided for college FAFSA application purposes.
    • Additional on-demand transcript summaries or copies of specific transcripts, including consultations about your situation can be provided on a fee-basis.

In addition to your responsibilities under the Alert Membership Service, you will provide a current passport or driver’s license to prove that you are the person signing the IRS authorization form. You agree to participate in a video call to verify your identity. This precaution is done for your protection. Your documents will be placed in our secure file-sharing service. You must access this service to retrieve your documents.

AUDIT DEFENSE MEMBERSHIP SERVICE

In addition to providing the Alert and Transcript Membership Services to you, we will represent your audit case before the IRS. This consist of the following:

    • We will handle all communications with the IRS, including letters and phone calls, during the audit.
    • We will assign a Case Manager to manage your case, who will be your primary point of contact about the case.
    • In coordination with you, we will review your returns, your crypto reporting. We will prepare a strategy for approaching your case to the IRS.
    • We will conduct legal research and prepare legal papers to accompany submissions to the IRS. These documents are to assert our legal position regarding the tax treatment of cryptocurrency transactions.
    • We will assemble responses to IRS Form 4564 Information Document Requests (IDR). However many there are, we will deliver the response to the IRS.
    • We will subcontract any outside consulting services to extend practitioner-client confidentiality privilege to the contractor. Our management fee will be 20% of the contractor costs.
    • Only the applicant is covered and their spouse if they filed jointly in the year under audit.
    • We will provide you with regular updates on the progress of your case.

In addition to your responsibilities under the Transcript Membership Service, you agree to carry out the following obligations:

    • Promptly schedule a call with CryptoTaxAudit upon receipt of the official IRS audit letters. Do not contact the tax authorities yourself. To ensure effective service regarding your audit, you must use your assigned CryptoTaxAudit representative(s) as your only contact with the IRS.
    • Time is of the essence in providing all documents requested by the tax authorities. Procrastination is interpreted by the IRS as being uncooperative. Being characterized as uncooperative can hurt your chances of a favorable decision before IRS Appeals or the courts. We reserve the right to discharge you as a client and terminate your membership for being slow to respond to document requests.
    • Do not fabricate any documents or fraudulently represent facts. These actions can cause you to be referred to IRS Criminal Investigation.
    • You must be thorough in communicating facts and documents that would have a bearing on the audit, including any prior communications written or oral, with the tax authorities; thoroughly searching and providing any and all relevant documents. These documents must be provided in a timely manner and in electronic format and organized chronologically.
    • Pay for any invoices for additional contractor services which would include calculation of crypto gains or expert testimony and support.
    • Your approval is required to accept any settlement offer.
    • You must maintain your monthly Audit Defense Membership payments for the audit duration and any appeal effort. Failure to do so will result in termination of our audit representation services.

GENERAL MEMBERSHIP SERVICE LIMITATIONS

For all membership levels, the following service limitations apply, but may be available for an additional fee.

    • We do not represent our members in Federal or State Court, including Tax Court.
    • We do not provide legal assistance in defending issues of civil or criminal fraud, whether actual or alleged.
    • We will not reconcile checkbooks, reconcile crypto transaction records, organize or summarize other records, or do record keeping or bookkeeping for our members.
    • We are not responsible for the extra work and costs involved if you fail to provide documentation in a timely manner which results in the auditing agency issuing a Notice of Deficiency (NOD) or the equivalent. If this occurs, CryptoTaxAudit will pass these costs onto the member in the form of a late fee or hourly fee services invoice.
    • We are not responsible to pay any taxes, interest, penalties or fines assessed against you.
    • All membership levels support the spouse. Spouses are included in the Audit Defense membership if during the audited year, the client and spouse filing status was married filing jointly.

LIMITATIONS OF REPRESENTATION BEFORE AUTHORITIES

You agree to the limited level of representation we agree to provide to you under IRS Form 2848. We do not accept full representation responsibility. We use the representation only to automatically pull your IRS transcripts. We do not agree to receive or forward copies of IRS correspondence. We will not discuss your account balances with the IRS except under a separate engagement and fee.

If you have additional persons you want to represent you before the IRS, please include them on the Form 2848 before our name.

We may request re-authorization of Form 2848 as needed to provide our services.

AUDIT DEFENSE PLAN EXCLUSIONS

Certain audits, tax returns, and issues of audit may be excluded from the Audit Defense Membership service for any of the following reasons:

    • Pre-existing Conditions: If the date of the initial mailed notice of audit (or Information Document Request or phone call) from the IRS or State is outside the Audit Defense Membership Period, Audit Defense services for that audit are excluded. If prior notices of the same audit were issued before the Acceptance Date of the Agreement, Audit Defense Services for that audit are excluded. Further, if an audit alert flag is generated and a member is notified due to his already being an active member but before the Member becomes an Audit Defense Member, then that audit is not covered by the service.
    • Ownership Interest in Other Tax Entities: If you have an ownership interest in a Corporation, Partnership, multi-member LLC, LLP, Trust, Estate, or Tax Shelter that has been contacted for an Audit and is not a CryptoTaxAudit member, Audit Defense
    • services for that tax entity are excluded.
    • Tax Protestors: We will stop representing you if you insist on protesting the taxing of income on economic, religious, legal or constitutional grounds, or other frivolous claims or uncooperative behavior.
    • Criminal Investigation (CI): If you have referred to or are under investigation by IRS Criminal Investigations unit (CI) at any time during an audit, you are excluded or discontinued from Audit Defense services. For any Audit that we are defending in which CI enters the Audit, we will cease working that Audit and will exclude the Member from further Audit Defense services until completion of the CI investigation.
    • Other Taxes: Your Audit Defense Plan is limited to federal income tax. Payroll tax, sales tax, property tax, gross receipts tax, city and local tax, estate and gift tax and compliance audits of pension and profit-sharing plans are excluded from the Audit Defense Plan.
    • Conflict of Interest: If a conflict of interest arises as described in IRS Circular 230, we must communicate the conflict to all parties and receive authorization to continue before continuing representation of parties.
    • Non-crypto-related audit issues: Defense of issues not related to cryptocurrency reporting are excluded but can be included for an additional fee.
    • CP2000 Letter: Responding to a CP2000 letter is not included in audit defense services because a CP2000 letter is not an examination or audit; instead it is an automated under-reporter notice. We can assist you in the response for a separate fee.

AUTOMATIC TERM UPDATE

From time to time, we may update the terms of this membership agreement. We will provide you a month’s advance notice of the change on the cryptotaxaudit.com membership website before it comes into effect. If you do not accept the terms of the change of the membership agreement, you may cancel your membership at no charge.

TERMINATIONS OF MEMBERSHIP AGREEMENT

CryptoTaxAudit reserves the right to terminate your Membership on the breach of any material provision of this agreement by you, if an Audit meets the criteria of any of the "AUDIT DEFENSE PLAN EXCLUSIONS'' listed above, or if a condition renders the completion of CryptoTaxAudit's responsibilities under this agreement unreasonably difficult to fulfill. Conditions that can cause completion of CryptoTaxAudit's responsibilities unreasonably difficult include, but are not limited to, failure by you to reasonably meet any provision listed as your responsibility above, failure to cooperate during the course of the Audit process, or repeated use of abusive, inappropriate, or unprofessional language when communicating with any staff members or representatives of CryptoTaxAudit or the IRS.

Your membership shall also be deemed to be terminated if you did not pay the monthly membership fee or other service invoices from us on time.

GOVERNING LAW

Delaware state law governs this agreement without regard to its conflicts of laws provisions.

DISPUTES

ANY DISPUTE OR CLAIM RELATING IN ANY WAY TO THE SERVICES OR THIS AGREEMENT WILL BE RESOLVED BY BINDING ARBITRATION, RATHER THAN IN COURT, except that you may assert claims in small claims court if your claims qualify.

The Federal Arbitration Act governs the interpretation and enforcement of this provision; the arbitrator shall apply Delaware law to all other matters. Notwithstanding anything to the contrary, any party to the arbitration may at any time seek injunctions or other forms of equitable relief from any court of competent jurisdiction.

WE EACH AGREE THAT ANY AND ALL DISPUTES MUST BE BROUGHT IN THE PARTIES' INDIVIDUAL CAPACITY AND NOT AS A PLAINTIFF OR CLASS MEMBER IN ANY PURPORTED CLASS OR REPRESENTATIVE PROCEEDING. BY ENTERING INTO THIS AGREEMENT AND AGREEING TO ARBITRATION, YOU AGREE THAT YOU AND CryptoTaxAudit ARE EACH WAIVING THE RIGHT TO FILE A LAWSUIT AND THE RIGHT TO A TRIAL BY JURY. IN ADDITION, YOU AGREE TO WAIVE THE RIGHT TO PARTICIPATE IN A CLASS ACTION OR LITIGATE ON A CLASS-WIDE BASIS. YOU AGREE THAT YOU HAVE EXPRESSLY AND KNOWINGLY WAIVED THESE RIGHTS.

To begin an arbitration proceeding, send a letter requesting arbitration and describing your claim to CryptoTaxAudit, in care of President, 12332 Sowden Rd Ste B-95616, Houston, Texas 77080. Arbitration will be conducted by the American Arbitration Association (AAA) before a single AAA arbitrator under the AAA's rules, which are available at www.adr.org or by calling 1-800-778-7879. Payment of all filing, administration and arbitrator fees and costs will be governed by the AAA's rules. You agree to have the arbitration conducted by telephone, based on written submissions. The decision of the arbitrator shall be final and not appealable, and judgment on the arbitration award may be entered in any court having jurisdiction thereof. This Section shall survive expiration, termination or rescission of this Agreement.