Ohio CPA Dana Stahl has been doing some inquiring of his own to see if the IRS in his state is targeting all 1040Xs with refunds due for full blown audits as they are doing here in Arkansas.  He sent me the following reports over the past few days. 

Mr Guru - I spoke to a TAS rep located in Cleveland whom I've worked with previously.  I believe she has integrity and is honest.  She said she has no knowledge of any IRS policy to target 1040X's w/large refunds.  Her comment was that it has always been IRS policy to review such 1040X's anyway, but no new trend concerning 1040X's is afoot inside the IRS, as far as she knows.  So, I guess the mystery deepens.  At least I've obtained some evidence from local IRS personnel here in Ohio.

Let's see what anybody else comes up with.  Based on what my TAS contact said, I'll carry on with my planned 1040X's for my problem IRS clients.

 

Let me know,

DS, CPA

Sandusky, OH

This 1040X/audit issue is really getting murky.  My TAS contact from Cleveland seemed to have no idea there was any controversy about this, but you've talked directly to IRS people in your neck of the woods who confirmed the IRS is moving into a hard line position with 1040X's.  Perhaps it really does boil down to the part of the country one resides in.  I'm planning to prepare 1040X's as part of my process for some IRS problem clients.  As a matter of fact, I prepped one today for a client who had been denied the EIC for her son.  We found that the son's SS# was incorrect on Sch EIC, so I made the correction on the 1040X.  I can't imagine this would get my client audited.

We'll talk again.  Thanx for the heads-up.

DS, CPA

The 1040X/audit controversy doesn't appear to exist in my part of the country.  As I told you, neither of the IRS people I talked to about this have any idea something brewing within IRS to give a 1040X "the audit treatment".  What are practitioners saying in other areas of the USA?

- posted by Kerry M. Kerstetter, MBA~CPA~ATP~ATA @ 12/10/2004 05:32:00 PM Send this post: