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O/T IRS Audit

Discussion in 'Uncategorized Threads' started by jm1079, Aug 11, 2008.

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  1. jm1079

    jm1079 Well-Known Member

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    a friend of mine just got an Audit Notice from the IRS and is asking me for advice. Anybody out there that has gone through this experience? Any piece of advice will be most appreciated. jm
     
  2. Dickgshot

    Dickgshot Well-Known Member

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    IRS audits are my field of specialization. What do you need to know?
     
  3. thomaslea1

    thomaslea1 Member

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    Tons of documentation to PROVE everything, and KY jelly
     
  4. wolfram

    wolfram Well-Known Member

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    Depends on the complexity of your friends previous filings. If he prepared them himself and has a lot of creative deductions then he may want to get a tax atty. If he used a CPA then he needs to get them involved in the audit.
     
  5. Fast Oil

    Fast Oil TS Member

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    This piece of advice came from a friend that was a IRS agent.

    NEVER SIGN YOUR NAME TO ANY DOCUMENT EXCEPT YOUR TAX RETURN, NEVER, NEVER!!!
     
  6. Dickgshot

    Dickgshot Well-Known Member

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    Nice. 4 consecutive post with bad advice by people who don't know what they're talking about. Cy-Kick, I'm surprised.
    (1) There are different types of audits, for different purpose, and so you need to know what is being asked for. Correspondence audit are becoming more common again, and only require that you mail documentation to the examiner. It may be an audit of deductions, but it could an audit to determine income, or the proper tax treatment of some transaction, or to reconcile the IRS's records with what is on the tax return.
    (2) All the commercials on TV are companies soliciting business to represent people who owe taxes. It is entirely different than an audit. For the most part they are scams.Stay away from them.
    (3) Tax attorneys are overkill for tax audits. A CPA or Enrolled Agent does better because they are more familiar with accounting and record keeping; and tax return preparation. A tax attorney can cost you more in fees that you would pay in taxes with no representation.
    (4) It is ludicrous to tell people never to sign anything but there tax return. There are documents in an audit that you sign to protect your rights, to appeal a determination, and to agree to a fair settlement.
    (5) The first thing to do is to determine what they are asking for, and what your potential exposure is. Even though I do tax representation, in many cases the taxpayer can do just fine handling the audit by himself. However, you probably ought to consult a professional to make sure that's the case - and not
    a professional that is just looking to make money from you.
     
  7. phirel

    phirel TS Member

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    dickgtax- On this site, or when talking with friends at the club, we need to be able to separate the good advice from the poor advice. Your advice was very good.

    I have never had an audit. My tax return is very thick and appears to be quite complicated to me. I sincerely hope my CPA knows what he is doing and I never have to seek your advice on tax matters.

    Pat Ireland
     
  8. jm1079

    jm1079 Well-Known Member

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    can i send you a pm? thanks. jm
     
  9. jm1079

    jm1079 Well-Known Member

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    sorry. dickgtax, can i send you a pm? jm
     
  10. Dickgshot

    Dickgshot Well-Known Member

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  11. jbbor

    jbbor Active Member

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    I got a "by mail" audit one time because a 1099 from a gun club checked a different box on the W-2 than I showed income and deductions for. It only took a revised W-2 and a couple of letters from my CPA to get it right. Jimmy Borum
     
  12. Jerbear

    Jerbear TS Member

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    Without going into too many details, I went through a corporate audit. I first contacted my personal CPA and got his advise as to how to proceed. I was told to go and get the large binders from Office Depot and have all my documents in binders with the year and contents in them. My corporate CPA was there at his office with me and to be honest, we were done in a half an hour. The IRS agent asked me questions and documentation to back it up, I went to the correct binder and showed what the documentation was and we moved on. Half an hour later she said she would get back to me and I received a letter of compliance not long after.

    I have always been told not to have the same CPA for business and personal, I can say this experience holds true. My personal finances did not come up because they were kept separate, and my CPA was known by the IRS as one that does not cross the line.

    Jerbear.
     
  13. Fast Oil

    Fast Oil TS Member

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    That's my story and I will stick to it. Dick, sorry but I have even read as recent as last week in another government (BATF) audit the advice is never sign any documents that are presented by agents of the government.

    Scott
     
  14. Jerbear

    Jerbear TS Member

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    The only thing I had to sign, was the check for my corporate CPA's time and conference room.


    Jerbear
     
  15. shannon391

    shannon391 Active Member

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    Al Capone never signed nuthin'.
     
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