Increasingly, CPAs are receiving requests from clients, lenders, loan brokers, health insurance providers, adoption agencies, regulators and various other agencies to confirm client information. In most cases, CPAs are asked to sign a confirmation letter containing specific language, a verification statement or a certification form.

The information may relate to a pending loan, employee medical insurance, child adoption application or use-tax certification. The most common type of requests is associated with mortgage loan applications of tax return preparation clients who are self-employed.

Ideally, clients should provide any requested information directly to third parties. If a client asks the CPA to send a copy of his or her tax return to a third party, the CPA must obtain the client’s signed written consent prior to doing so. Protecting the confidentiality of client information is required under professional ethics standards, the Gramm-Leach-Bliley Act, the Internal Revenue Code, state board of accountancy rules or regulations, and federal and state privacy statutes and regulations.

For a complete handbook and sample letter of response, members click here.