Practice English Speaking&Listening with: Surviving an IRS Tax Audit : IRS Audit: Proving Expenses

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So what happens if your tax return has been selected for an IRs audit and you're missing

some of the receipts that you need to substantiate the items that the IRS is looking for during

your IRS audit? The information document request that the IRS is going to send you is going

to give a detail of the items that they want you to bring in. For example, if they're auditing

some car and truck expenses that you might have claimed on schedule C or a 2106 for business

expenses, they might ask you to bring in repair receipts, inspection slips, or other information

to show your mileage. You might not have this information, but instead you would have some

sort of calendar, log book, or something that you kept information for about the miles that

you've drove. If this information has been lost then you need to recreate this information

from the best records that you have available. For example, if you have business receipts

that show on a daily basis a product that you picked up, supplies that you picked up,

bank deposits that you made, that would give you a history of some of the mileage that

you drove back and forth to pick up those supplies, visit customers, or go to different

job sites or offices. Other things that they might ask for is physical inventory sheets

if you have inventory. Again, you need to recreate those from your accounting records

if you are unable to locate the original receipts. You want to try to have all receipts possible.

You might also consider contacting some of your vendors and asking them to provide copies

of the receipts. If you've lost credit card statements see if those can be downloaded

or obtained on line. If you're missing bank statements or canceled checks, usually you

can go back to the bank and ask for copies of those bank statements and canceled checks

as well. Because you want to make sure that you're going to have the documentation that's

been requested on the information document request when you go in. You don't need to

go in and point out what you're missing, but you need to make sure that the information

that you take in is as complete and accurate as possible. That will help the audit process

go quicker, faster, and yield a better result for you in the end.

The Description of Surviving an IRS Tax Audit : IRS Audit: Proving Expenses