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How Would Your Dealership Hold Up in an IRS Audit?

Learning Objectives 

  • Understand the key items of interest in the audit guide
  • Understand IRS audit techniques for specific areas
  • What to do in case of an IRS audit
  • Tax Planning Ideas

What’s the Big Deal? 

Tax Gap = $300 Billion per year ! in 2001

Other Reasons to be Concerned… 

  • According to the IRS, since 2001..
    • enforcement activities recovered $43 billion of the tax gap in 2004 compared to $33 billion in 2001
    • Audits of high-income taxpayers ($100,000+) topped 195,000 in 2004 – double the amount in 2001
    • Total audits topped 1,000,000 in 2004 – 37% increase from 2001
     

New Guidance Issued for Dealerships 

  • New Vehicle Dealership Audit Technique Guide Issued on CD-Rom in January 2005
    • Helps isolate areas of focus
    • Allows for understanding of IRS position
    • Indirectly identifies tax planning opportunities
     

IRS Audit Guide Table of Contents 

 

Contact 

Charles Diegel, CPA
215-881-8882

Tom Earley, CPA, MST
215-881-8883

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