Advanced IRS Examinations: What the IRS Will Look at and Why?
Author: Eric L Green
| CPE Credit: |
2 hours for CPAs
2 hours Federal Tax Related for EAs and OTRPs
2 hours Federal Tax Law for CTEC |
With less staff and more priorities than ever before, the IRS is pressed to do exams that show the potential to have significant results. This two-hour course will bring you up to speed on the latest statistics, and what the IRS looks at when it focuses on certain businesses, including cash-based businesses and Schedule C exams. IRS exams are getting more complex and auditors are coming armed with a range of tools to ensure an assessment results. In addition to discussing IRS issues, Mr. Green will discuss what to do when the client’s records may not be as stellar as you would otherwise like, and what you can and cannot do about it. Incomplete records don't mean the case is hopeless but it does mean you'll need to do extra work and have a story that meets IRS standards and precedents from Tax Court and Appeals.
Publication Date: August 2022
Designed For
All CPAs, EAs, and attorneys who represent clients on audit.
Topics Covered
- IRS exams: Latest data and trends
- Ethical Concerns
- First Steps for Preparing for the Exam
- Home Office Concerns
- What About the Quickbooks File?
- Taxpayer Interview
- Documentation
- Examiner Requests
- IRS Focus?
- Small Business "Watch Outs"
- Indicators from Information Gathering
- Correspondence Exams
- Letter 525: Combo Letters
- Requirement to Maintain Records
- Income Reconstruction
- The Cohan Rule
- Methods of Reconstruction
- Formal Indirect Methods
- 433-A CIS Approach
- Requirement to Make Reasonable Inquiry
- The Appeals Conference
Learning Objectives
- Recognize how to plan for IRS exams of small business clients
- Identify the latest IRS trends in audits
- Recognize how to prepare for an audit with records that are incomplete
- Describe correct statements when preparing an audit
- Identify which IRC Code section with respect to interviewing taxpayers during the exam applies
- Identify one of the small business "watch outs"
- Identify the no response rate with respect to correspondence exams
- Describe which method of reconstruction is difficult to match reported income with specific items/sources
Level
Advanced
Instructional Method
Self-Study
NASBA Field of Study
Taxes (2 hours)
Program Prerequisites
Experience with federal income taxation of individuals and small businesses and IRS exam procedures.
Advance Preparation
None
