Last Updated: 1/30/2023
This Engagement Letter (“Engagement Letter”) is made and entered into by and between Collective Hub, Inc. (“Collective”) and you (the “Client” or “you”) as of the date this Engagement Letter is executed or otherwise entered into by you in accordance with the terms herein (the “Effective Date”). Collective and Client are referred to individually as a “Party” and jointly as “Parties”. This Engagement Letter is incorporated into the Terms of Service Agreement available at https://www.collective.me/terms-of-service.html (the “Agreement”). Capitalized terms used herein, but undefined will have the meaning given to such term in the Agreement.
BY REGISTERING FOR, USING AND/OR RECEIVING THE TAX SERVICES, OR BY CLICKING THE “I ACCEPT” OR SIMILAR BUTTON, YOU AGREE TO THE TERMS OF THIS ENGAGEMENT LETTER.
1. Term
The duties and obligations of both the Client and Collective shall commence on the Effective Date and continue for a period of one (1) year thereafter (the “Initial Term”). Thereafter, this Engagement Letter will automatically renew for successive one (1) year periods (each, a “Renewal Term”, and together with the Initial Term, the “Term”), unless either party provides at least thirty (30) days’ notice prior to the end of the Initial Term, or Renewal Term, as applicable, of its intent to terminate this Engagement Letter. Notwithstanding the foregoing, Collective may require you to consent to an updated Engagement Letter or Statement of Work in a specified manner prior to each Renewal Term before any Tax Services for the applicable Renewal Term may be provided. This Engagement Letter may be terminated by either party by giving a thirty (30) day written notice in accordance with the Agreement. Furthermore, either party may terminate this Engagement Letter for cause in the event the other party breaches any material term and fails to cure such breach within seven (7) days of the non-breaching party’s notice thereof.
2. Scope
Subject to the terms and conditions of the Agreement, including the payment of applicable fees, Collective agrees to provide the following tax return preparation services during the Term (“Tax Services”):
One-time:
(1) Initial call to assess if your business is within scope for Collective
(2) Tax assessment for your business
Ongoing:
(1) Year-round tax support for your business
(2) Annual business entity tax preparation, as set forth in the Statement of Work
Additional Services:
From time to time, the parties may agree to additional Tax Services or tools, which shall be subject to the terms of this Engagement Letter, by executing a mutually agreed upon written (electronic acceptable) addendum or statement of work that references this Engagement Letter. Such additional services may be subject to additional fees.
Personal Tax Return Preparation
In the event Collective determines Client’s personal tax return is within the scope of Collective’s Tax Services, Collective may prepare such tax return in connection with the Tax Services subject to the terms herein, including the Agreement, and as set forth in the Statement of Work.
Joint Personal Tax Return Preparation
If you are married and filing jointly and, as stated above, Collective has determined your personal tax return is within scope, and agreed to its preparation in writing, Collective will prepare and file your joint tax return subject to the conditions set out in the Agreement.
Spouse’s Business Income
If your spouse owns or operate a business, and business income from such business must be reported in your joint tax return, Collective may, but shall not be obligated to, prepare such tax return in connection with the Tax Services for an additional mutually agreed upon fee, subject to the terms herein, including the Agreement.
If your spouse forms or acquires a business after your initial engagement with Collective, you must timely notify Collective to determine whether we will be able to prepare your joint return.
However, Collective reserves the right to decline to prepare any personal tax return and/or joint personal tax return for any reason, including a spouse owned business and/or change in income. Furthermore, Collective has no obligation to prepare any personal tax return (including joint return) hereunder, unless agreed upon in writing by Collective. Client acknowledges and agrees that any agreement by Collective to prepare any personal tax return is conditioned upon the accuracy, completeness, timeliness and truthfulness of information provided by Client, including, without limitation, and as applicable, whether you and your spouse are legally married and whether your spouse owns or operates a business. In the event any such information is inaccurate, incomplete, out-of-date or false, you must promptly notify Collective.
3. Out of Scope
In no event will the Tax Services include, without limitation:
- Preparation of tax returns for any year, other than the tax year of the then-current term.
- Review of a tax return that was not prepared by Collective
- Tax audits to your tax returns that may be audited by the tax authorities. Any proposed audit adjustments are subject to certain appeal. Should Client’s returns be selected for examination, client should inform Collective of such examination.
- Local county and city taxes
- Personal property taxes
- Business property taxes
- International/Foreign taxes and/or Residency Certifications
- Issuing Form 1042 or advising on international withholding
- Sales, use, gross receipts (Business & Occupation), franchise, excise tax
- Assessment, advisory, or application of nexus tax liability between states
- Annual filing requirements with the US Secretary of State
- Annual filing requirements with the US Department of Labor
- Form 83(b) elections
- Form 1031 exchanges
- Remittance of estimated payments
- Additional household Schedule C businesses or Schedule E Flow-Through or Rental Properties
- Issuance of Form 1099, Form W-2 for transactions that occur outside of Collective’s payroll provider.
- Filing of Schedule H
- Filing or guidance for non-profit entities
- Specific investment recommendations concerning investment, insurance, or other financial products
- Forensic audit to perform any forensic examination of your financial books or records
- Attest Services to your financial books or financial records of any kind or nature
- Cost Segregation
- Creation and funding of:
- Retirement account
- Health insurance plans/DCA
- Health savings accounts
- Dependent care plans
4. Client Obligations
Decision Making
You are solely responsible for all final decisions concerning financial management, reporting, tax returns, and financial reporting. You agree to review all tax returns, reports, and other documents carefully before signing and/or relying upon them. You acknowledge and agree that Collective shall not be responsible or liable for any decisions made by you, or for any tax returns, reports or other documents executed or submitted by, or on behalf of you,
Communication
You agree to communicate any problems or issues with your accounting systems and/or financial services related to the Tax Services. You agree to provide responses within 48 hours to questions and issues raised by Collective agents and employees.
Cooperation and Access to Information
You agree to provide Collective with any information and permissions reasonably requested by Collective in order to perform the Tax Services. Client acknowledges and agrees that Collective’s performance hereunder is conditioned upon Client’s performance of its obligations herein and reasonable cooperation.
Accuracy of Information & Full Disclosure
You acknowledge and agree that you are solely responsible for disclosing all income and other reportable tax transactions, and that the failure to do so may result in penalties and additional liabilities. Collective shall have no liability for any failure by you to appropriately disclose such income and transactions.
Client acknowledges that Collective’s performance of its obligations herein, and any advice or information provided by Collective in connection with the Tax Services is based upon the information provided and made available by Client. You represent, warrant and covenant to Collective that all information you provide to Collective in connection with the Tax Services is accurate, complete, current and true, and that if you discover that any such information is inaccurate, incomplete, out-of-date or false, you will immediately notify Collective in writing and promptly correct such information. You acknowledge and agree that you shall be solely responsible for, and shall hold Collective, its affiliates and their respective officers, directors, employees and contractors harmless from any costs, expenses (including reasonable attorneys’ fees), damages, judgments, liabilities, losses, penalties and settlements arising from or related to your breach of the foregoing representation and warranty. Collective shall not be responsible or liable to you or any other person or entity for any delays, penalties or other consequences arising from your breach of the foregoing representation and warranty.
Commingling of Business & Personal Accounts
You will ensure that any of your business accounts or expenses shall not be commingled with any of your (or its spouse’s or other third party’s) accounts or expenses. In the event your business accounts are commingled with your or your spouse’s personal accounts and expenses, that Collective cannot accurately perform the Tax Services.
Additional State Filings
In the event your business generates more than $10,000 in gross receipts or 25% of your sales from a state in which you do not reside and your S Corp is not registered, you must promptly notify Collective to help you determine whether you have income tax filing requirements in that state. Should Collective agree to assist you with any additional state filings, an additional fee may apply.
6. Tax Professional’s Judgment
Collective agents and employees will use their 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. Collective will rely on our best professional judgment and is not liable for any penalties that might be assessed against it as return preparers. You agree to honor Collective’s decisions regarding disclosure of tax return positions to avoid or mitigate penalties.
7. Treatment of Personal Information
Collective will collect, store, process and disclose any information you provide in connection with this Engagement Letter in accordance with Collective’s privacy policy available at https://www.collective.com/privacy-policy.html.
8. Disclaimer
The Tax Services will be provided solely with respect to that business you have identified to Collective in connection with your Collective account. Collective will not perform an audit or review of your financials or any other related documents you may provide. All advice and information made available by Collective in connection with the Tax Services is based on the information you provide to Collective, and the Tax Services cannot be relied upon to discover errors, fraud, defalcations or other irregularities, should any exist. We will not audit or otherwise verify the information you submit, although we may ask you for clarification of some of the information. Collective is not responsible for any information or advice given based on any inaccurate, untrue, incomplete or out-of-date information provided by you. You are solely responsible for your acts and omissions related to the Tax Services.
9. No Guaranteed Results or Responses.
Collective does not make any representation or warranty that the Tax Services will be appropriate for your needs or suitable for your business. Collective does not guarantee and expressly disclaims any particular results. SINCE THE TAX SERVICES ARE BASED ON THE INFORMATION YOU PROVIDE, Collective does not warrant that the Tax Services will be timely, accurate, current or complete. Collective may make available third party communication tools, to enable you to communicate with our tax preparers, but Collective makes no representation or warranty that such tools are secure or that our tax preparers will be able to respond to you in a timely manner.
10. General
Client acknowledges and agrees that the Agreement https://www.collective.com/terms-of-service is incorporated herein by reference, and that the terms thereof shall apply to the performance of each party’s obligations herein, including, without limitation, the sections relating to Limitation of Liability, Indemnification, and Arbitration.
