Greg Orcutt

 

Orcutt & Company, CPA

936 State Route 28, Milford, OH 45150

 

Phone:  513-576-1989 

 

Email: greg@orcuttfinancial.com

February 2020

February 2020 Client Profile

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Miriam owns a bakery and her business recently received a tax audit letter from the IRS. How far back will the Internal Revenue Service want to examine her tax returns? What will she need to do to resolve her tax situation?


The IRS should spell everything out for Miriam in the letter, but she should consult a tax professional to find the best solution possible. There are different types of business audits and responses needed to satisfy the IRS.


One is a mail audit, in which the IRS will send a letter requesting additional information about certain items on the tax return such as income, expenses and deductions. She can request an in-person audit if she has too many records to mail. The IRS also could initially request that she meet in person at her home, place of business or an IRS office.


Generally, the IRS will audit up to three years’ worth of returns, but can request six years’ worth of records. Miriam may request an automatic 30-day extension and she may want to consult a tax professional who is also an enrolled agent.


Client Profile is based on a hypothetical situation. The solutions we discuss may or may not be appropriate for you.


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