1. Home
  2. Taxes General Forum
  3. Got Letter From IRS For Audit - Need Advice Please

Got Letter From IRS For Audit - Need Advice Please

I got a letter for from the IRS and they want to audit my business. Specifically they are interested in two items for the 2005 tax year:

- receipts concerning business legal expenses which I deducted from my gross income

- gross receipts for 2005

In the letter it says the following: "If you do not respond to this letter, we will issue an examination report showing additional tax due. Therefore, it is to your advantage to call and schedule an appointment." My question is, should I not call and wait for them to send me this examination report showing any taxes due. If the taxes aren't too much, I'll just pay them. When I think about how much time it will take to prepare for an audit, hire a CPA, etc. I think it would be simpler just to pay whatever I may owe. I suppose if the amount they say I owe is outrageous, I can either make an appointment at that point with the IRS auditor or even appeal the tax amount they say I owe. Any advice would be greatly appreciated. Thanks.

> > > > > > > > >
Reply to
bjackson445
Loading thread data ...

You wrote to this forum asking advice

Accordingly, my advice is to CALL YOUR CPA (or ea) TODAY

___________________________________

-----> real address on hobokeni or hobokenx

Reply to
Benjamin Yazersky CPA

  1. Take the bull by the horns, iow, pro act instead of react.
  2. Find a local Enrolled Agent (EA) or CPA of course, who is experience in representation matters to handle this for you. I say this because, they know something you don't know. And therefore it's best to take yourself out of the equation by hiring a .... well. a "mouthpiece". Before the audit, go back an verify each and every business receipt of income, matching it up with reported 1099's from vendors. And make sure you have a statement from the lawyer as to exactly what the business purpose was for his fees. When you meet with your representative, be prepared to bare your soul. You won't have to go to the audit with him, but you will have to prove your case for your representative to adequately represent you. good luck!

Oh, btw, you would only just pay them what they say you owe IF you have a guilty conscience. ChEAr$, Harlan Lunsford, EA n LA

Reply to
Harlan Lunsford

Traditionally, they will take your gross receipts - disallow everything and assess the tax, penalties, interest and the

100% responsible party penalty ........... Basically everything they can hit you with. Now it is your choice.

Regards,

Mark

Reply to
Mark X. Rigotti, CPA

Count on the amount that they say you owe being outrageous.

Reply to
Vic Dura

Thanks for all the advice. As I look around for a CPA, how much do they typically charge to prepare for and conduct an audit? What are the rates of CPA's in general? Thanks.

Reply to
bjackson445

BeanSmart website is not affiliated with any of the manufacturers or service providers discussed here. All logos and trade names are the property of their respective owners.