IRS Is Gearing Up; Don’t Throw in the Towel
The IRS is shifting the focus of its examinations of businesses. Fewer resources are being devoted to very large corporations, defined as those with assets of $250M or more. The Service has streamlined its audit process for these firms, especially in light of Schedule UTP (Uncertain Tax Positions), which firms this size are being required to submit with their corporate return.
Greater emphasis will be given to pass-through entities such as S Corporations, Limited Liability Companies and Partnerships; especially, those with assets between $10M - $250M. Firms of this size should be prepared for a much longer audit cycle then they may have been accustom to in the past, possibly as long a 10 – 12 months. Plus, the age of the specialist has arrived at the IRS. Firms can expect to see specialists in such areas as IT, pension and international; in addition to the lead auditor. In the international area alone, the IRS hired international auditors last year and plans to hire another 300 this year.
If you are looking for an accounting firm to assist you should an audit befall your company, the firm you select should be able to match the specialists from the IRS mano-a-mano. This way, you are best equipped to deal with the issues of the audit with a solid team behind you.