Try and get things worked out with the IRS before reaching out to a CPA and/or a Tax Attorney. If there is some sort of misunderstanding here, it will eventually get worked out.

I would seek out a CPA before trying a tax attorney. Attorneys deal mostly with issues involving trusts, estate planning, structuring a business, international tax laws, or criminal investigations involving the IRS. CPAs are more trained to deal with filing returns, handling appeals and working with the IRS on issues. Just my opinion, of course.

I would seek out a CPA before trying a tax attorney. Attorneys deal mostly with issues involving trusts, estate planning, structuring a business, international tax laws, or criminal investigations involving the IRS. CPAs are more trained to deal with filing returns, handling appeals and working with the IRS on issues. Just my opinion, of course.

 

Many tax attorneys are CPA's as well. Why hire a CPA first only to find out that you need a tax attorney later?

Many tax attorneys are CPA's as well. Why hire a CPA first only to find out that you need a tax attorney later?

 

I did not know that although come to think of it, I do know one guy who is both. :thumb:

Many tax attorneys are CPA's as well. Why hire a CPA first only to find out that you need a tax attorney later?

 

Trust me when I say this situation does not require a tax attorney and not real sure it requires a CPA either, at least not yet. Why spend money that you do not need to spend?

Trust me when I say this situation does not require a tax attorney and not real sure it requires a CPA either, at least not yet. Why spend money that you do not need to spend?

 

Obviously he's overwhelmed trying to handle it on his own for the past year. Free consultations are pretty inexpensive...

This isn't helpful...but I am thinking about you and hoping it works out.

I'm going to dedicate this weekend to getting things at least on the right path to being worked out or settled. Starting with the IRS...then going from there.

Sad news is that once you get audited, you are more likely to audited in the future? Anyone else hear that?

Sad news is that once you get audited, you are more likely to audited in the future? Anyone else hear that?

 

I mean if there's a legitimate reason someone is audited, I can see how that would be the case.

Sad news is that once you get audited, you are more likely to audited in the future? Anyone else hear that?

 

I was audited 5 years in a row. IRS ended up owing me more money all 5 times. Last time was 2004 tax return. Havent heard from them since then.

I'm okay with paying what I actually owe. But there's no way they should throw out all of my legitimate expenses.

 

Standard IRS process is to toss the entire line item and declare you owe them - even when or if it should be obvious that even that is not 'correct'. They do not guess or assume, they just toss the entire item as their starting point.

 

Once I forgot about some stock sold. Of course the brokerage firm reported it in but I did not have it in the files. IRS response was to tax the entire sale as gains, though - obviously - only the gains from when bought to when sold was taxable and considerably less. But they do not care they just start with taxing the entire transaction.

 

My brother is CPA and my tax preparer - on the above and other minor issues over the years that came back he always knew how to let the IRS know it was being worked until the full 'corrected forms' were ready. He even cleaned up my HOA tax status and situation after the previous board from when I came in let everything lapse. Point is - for seasoned CPAs dealing with the IRS is much easier for them than for us mere mortals. They know who, how and when to contact them. So like many have said - do not try to fix this on your own. Get a new CPA/tax attorney to deal with this from the start in terms of working with IRS.

 

This will take a few cycles of back and forth before its done but this is not heavy lifting for a good CPA.

Standard IRS process is to toss the entire line item and declare you owe them - even when or if it should be obvious that even that is not 'correct'. They do not guess or assume, they just toss the entire item as their starting point.

 

Once I forgot about some stock sold. Of course the brokerage firm reported it in but I did not have it in the files. IRS response was to tax the entire sale as gains, though - obviously - only the gains from when bought to when sold was taxable and considerably less. But they do not care they just start with taxing the entire transaction.

 

My brother is CPA and my tax preparer - on the above and other minor issues over the years that came back he always knew how to let the IRS know it was being worked until the full 'corrected forms' were ready. He even cleaned up my HOA tax status and situation after the previous board from when I came in let everything lapse. Point is - for seasoned CPAs dealing with the IRS is much easier for them than for us mere mortals. They know who, how and when to contact them. So like many have said - do not try to fix this on your own. Get a new CPA/tax attorney to deal with this from the start in terms of working with IRS.

 

This will take a few cycles of back and forth before its done but this is not heavy lifting for a good CPA.

 

Your first comment is a false one. Those are the olden days and only occurred when there was no response to an inquiry received.

 

Your situation is completely different because it involves income for which the IRS has no means of determining the basis. A match of information returns against your return resulted in a finding that an item of income was not reported.

Have you contacted the Taxpayer Advocate Service? You can find it on the IRS website. The link may be http://www.irs.gov/advocate.

 

Good luck. In my dealings with the IRS, it often comes down to the person you are either fortunate enough or unfortunate enough to talk with.

If the CPA was working in KY, you may try the Kentucky State Board of Accountancy, they are the regulatory body for us bean counters. I would have to think, retired or not, the CPA has an ethical obligation to fix an error he or she is responsible for. If you get no cooperation from the CPA, I would guess they could tell you what legal options you have against him or the old firm even without errors and ommissions insurance. You may be able to sue him or the CPA firm for the penalties and interest along with reasonable fees paid to a CPA to correct the error.