Dec
04
2009

  One Audit Close To Done

I'm one step closer to being done with the New York state audit of our 2006 tax return. After I sent the information requested, we got another letter asking for more information. But this time they requested more than I suspected they really needed. I understand why they had to make the broad request; the specifics they wanted to see weren't included in the first batch of papers I sent them, so they had to guess about where to look.

But simply complying with their request would have been a nuisance, so I called the agent to figure out what exactly she needed. As it turns out, all she needed was a letter from me describing the transaction they most care about, and any documentation I have. And I have a page of documentation handy because it is ALSO something the Federal auditor wanted to see. . .

So I just prepared two pages for the mail instead of the dozens I would have needed if I didn't make the phone call. Terry initially questioned my desire to make the call, and wanted me to just send what they asked for.

Here's a tip from someone who's dealt with a lot of auditors in her life: there are no "magic" set of documents required for an audit. The auditors ask for a bunch of stuff which they'll sort through and see if anything sticks. If the auditor is halfway competent, there is a good chance you can have a discussion with them so you can cut to the chase and send them exactly what they need for their files so they can close the case. But hopefully, none of you will ever have to deal with a tax audit, they are really a pain in the @#$# and I know they induce great angst in people who are not professional accountants.