Keeping CPAs Up to Date on Tax Matters

A site devoted to articles on current developments in federal taxes geared toward CPAs in tax practice.

IRS Within Its Rights to Increase Tax Due for Audit When Taxpayer Filed an Amended Return After Audit Report Was Accepted

December 06, 2017 by Ed Zollars, CPA

In the case of Planty v. Commissioner, TC Memo 2017-240, the Tax Court found the IRS did not conduct an impermissible second examination barred by IRC §7605(b) when the taxpayers filed an amended tax return after accepting the original examination report.

In effect, the taxpayer took a slightly bad situation (owing tax on an exam) and made it far worse (IRS determined they owed far more tax for the year in question) by attempting to amend the return for the year in question.

Image copyright tang90246 / 123RF Stock Photo

IRS Has Right to Look at Records for Year Previously Examined to Verify Net Operating Deduction for Exam of Later Year

February 09, 2016 by Ed Zollars, CPA

Beyond the simple issue that it may lead to an IRS claim that the taxpayer owes additional taxes, an IRS inspection of the taxpayer’s books and records is also simply a huge (and often expensive) inconvenience. IRC §7605(b) is meant to limit that disruption by giving the IRS “one shot” at the records on an audit.