October 2011

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« Nonreceipt of K-1 Not Reasonable Cause; Accuracy-Related Penalty Assessed | Main

October 03, 2011

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Maybe we should simplify the tax laws...jeeze.

I wonder where GM and other major companies would be if they could cut back on the less necessary expenses!

Business Expenses on schedule C is one of the many reasons returns get flagged for audit by irs. Taxpayers need to be mindful that their expenses should be reasonable and that they need to have proof of the expense.

I can understand the reason for a Schedule C audit of expenses, but I had one this past year where they disallowed Schedule A miscellaneous deductions for a taxpayer for the very same reason, not usual and necessary. And to top it off, he was heavy into AMT where it didn't amount to anything. The deductions only had a benefit on the state return. After several memos from me as well as his employer, they reversed their decision and restored everything. What a bloody waste of time and money!

intentionally and knowingly deceiving the IRS or an accounting mistake? 162 is complex but where do you draw the line?

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