My BF used Jackson Hewitt for his taxes. He had income like interest from foreign bank savings accounts, dividends from foreign mutual funds. The tax preparer told him that interest from foreign bank accounts, dividends from foreign mutual funds can be reported on 1040 as if they were interest from US bank accounts and qualified dividends as if they were reported on 1099-DIV. I went with it and we did a regular 1040.

Now, a colleague at my company who uses a CPA told me that
dividends from foreign mutual funds need to be reported using form 8621 and my BF could be in for a audit by IRS since he reported them as qualified dividends whereas those dividends may not have qualified for the qualified dividend rate

Now, is my BF covered because he used a tax preparer from Jackson Hewitt or on the hook if IRS contacts him for audit? I hear if you use a paid preparer IRS holds them responsible for the mistakes on tax preparation. But, how much of this is actually correct? Also, won't the Jackson Hewitt office try to avoid blame in this case? He clearly told them that he does not know how to report interest from foreign bank savings accounts, dividends from foreign mutual funds. They called their main office in town and were told it was OK to do his foreign income reporting on a 1040. The foreign income was 1200, his US income is 44K and filing status is single.