QuickBooks and IRS Tax Audits
A Senior IRS agent recently told me that each unit now plans to have at least one person trained in Quickbooks. She indicated that the IRS can then ask for a copy of your Quickbooks file instead of requesting all of the printouts provided to them by the taxpayer’s representative or the taxpayer.
Recently, we were referred a business client who was in the middle of an IRS audit and was represented by a tax attorney. We had our team of myself (CPA , MS in Tax) and our Quickbooks ProAdvisor help with the audit. The owner of the Company said as soon as we became involved the entire audit changed in the company’s favor. Why – Because we teach Quickbooks. We’re the experts at Quickbooks and we quickly gave the IRS exactly what they requested and assisted them with what they were looking at.
In order to come up with a winning strategy with the IRS, we need to cooperate and treat the IRS with respect but we do not need to answer any questions not asked and we never give the IRS anything more than what they are requesting. For example, if the IRS requests 2009 information, we do not give them our Quickbooks file as is because that file usually has several years of information on it!
We have had excellent success at the lower levels with the IRS and at the Appeals division. Our ProAdvisor along with a CPA/MBA is a must on every IRS audit client that utilizes Quickbooks
julie diggs says
This is an interesting article. Do you think using Quickbooks can actually hurt my business? I like Quickbooks, but I am no expert. I’m always needing help making it work for me.
accountantcalifornia says
All businesses are required to have books and records. Quickbooks will help not hurt your business. Businesses fail for three reasons:
1) Lack of Capital
2) lack of expertise in the business
3) Lack of financial controls
Quickbooks is solid for financial controls. Eg It can help you with your financial forecasts and you can input your forecast for the year by month and compare that to actual. If you know where you are income wise and cash wise, you can usually make more informed decisions.
QuickBooks is a great business tool. It is even better with professional help.
bert says
I always thought the IRS would be able to use Quickbooks. I’m glad there are people who can help me keep my information private. I guess its really important to get help when I am audited. How often are businesses audited?