The IRS is using sophisticated computer analysis to determine whether your business return is worthy of audit. They have created a data warehouse to do this (see previous post). The data warehouse may not get you right away, but the IRS has seven years. Do you have your 2002 tax documents available much less your tax return? Probably not unless you work with Patriot.
The game is one of probabilities. The IRS takes your SIC code (Standard Industry Classification) for your business (example "convenience store") and compares your return with all the other convenience store returns that have been filed for that year. If you lie outside a "bell curve" of values for certain accounts, you may be selected for audit. The "audit" may merely be a request for source documents, or it may be a "full blown" examination of your books and records. Anyway they audit you will lose unless your business tax return can be traced to source documents. That is what we do at Patriot.
We classify your income and expenses correctly on your business return so there is never any question.
Let us be your risk manager as far as IRS sudits go.
Call Blaine at (978) 604-4253 or email him at patstax@gmail.com
Visit our website at:http://patriottaxandbookkeeping.com/
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