What specific due diligence obligations are imposed on Ledgers franchisees by the IRS and state laws?
Ledgers Franchise · 2025 FDDAnswer from 2025 FDD Document
In operating this franchise, you will be subject to laws and regulations from the IRS and states on obtaining the ability to e-file tax returns, due diligence, recordkeeping, privacy, and other laws.
You will also be subject to laws concerning administrative, technological and legal protections to safeguard customer data.
Certain states also regulate tax courses and require registration of such courses.
And certain states, such as California, Maryland, and Oregon, require training and licensure in order to offer tax preparation services. You should investigate the application of these laws further.
Source: Item 1 — THE FRANCHISOR, AND ANY PARENTS, PREDECESSORS AND AFFILIATES (FDD pages 8–10)
What This Means (2025 FDD)
According to Ledgers' 2025 Franchise Disclosure Document, franchisees are subject to various laws and regulations from the IRS and states. These regulations pertain to obtaining the ability to e-file tax returns, conducting due diligence, maintaining records, ensuring privacy, and adhering to other relevant laws. This means a Ledgers franchisee must comply with IRS and state requirements for electronic tax filing, which may involve specific application processes, software certifications, and security protocols.
Furthermore, Ledgers franchisees must implement administrative, technological, and legal safeguards to protect customer data. This includes complying with data protection laws and regulations, such as implementing cybersecurity measures and adhering to privacy policies. Certain states also regulate tax courses and require registration of such courses, which may impact franchisees who offer tax-related education or training.
Additionally, some states, like California, Maryland, and Oregon, mandate specific training and licensure for individuals offering tax preparation services. Therefore, prospective Ledgers franchisees should investigate the specific requirements in their state to ensure compliance with these laws. This may involve completing specific training programs, passing examinations, and obtaining the necessary licenses or certifications to legally provide tax preparation services. Failure to comply with these regulations could result in penalties, legal action, or the inability to operate the franchise.