Concerns about privacy when selling my tax business

[dwetz1]

I am selling my tax business to another preparer. When I let my clients know, can I give them an opt out form before I give their information to the other preparer or does it need to be an opt in? Is there an official form to use or can I create my own wording?

[abctax55 · Accepted solution]

You can NEVER divulge client info to a third party without your client's written authorization.  Hell, you are not supposed to even acknowledge a professional client relationship exists when a mortgage lender calls for info without prior authorization from the client.

Your E&O insurance likely has the boilerplate language to use; so does the AICPA.  Circular 230 may even have the specifics.

You don't 'own' your clients or their info.  What you are selling is the possibility the clients will continue to use the new owner for tax prep.   A letter of introduction to the new person (when you ask for permission to provide info to that person) would be a good idea.

[abctax55]

A little help from google:

https://us.aicpa.org/content/dam/aicpa/advocacy/tax/downloadabledocuments/draftarticle8%20_reviewed.....

[Accountant-Man]

I had over 600 clients, so I gave them an opt out with a drop dead date. About 20 opted out, and about 100 didn't opt out but never came over.

Therefore, only about 20 did not have their data transferred. The rest did, but never told me not to do it.