5/27/2023 0 Comments Passive activity audit guideEach type of return might have unique industry issues, business practices and terminology. IRS auditors need to examine different types of businesses, as well as individual taxpayers and tax-exempt organizations. Others address issues that frequently arise in audits, such as executive compensation, passive activity losses and capitalization of tangible property. Many ATGs target specific industries or businesses, such as construction, aerospace, art galleries, architecture and veterinary medicine. In other words, your business can use the same guides to gain insight into what the IRS is looking for in terms of compliance with tax laws and regulations. Examiners may use IRS “Audit Techniques Guides (ATGs).” A little-known secret is that these guides are available to the public on the IRS website. Knowing how to access these guides will help level the playing field for the taxpayer being examined.In order to prepare for a business audit, an IRS examiner generally does research about the specific industry and issues on the taxpayer’s return. You should anticipate that your adversary from the IRS will have taken similar steps. If one cannot find an ATG at the above referenced site it would be wise to search for the following more dated references. Many are available from commercial publishers. The following ATG's and MSSPs are found at other locations on the IRS website. Sections 48A and 48B - Advanced Coal and Gasification Project Credits: 5/09Īlso available on the IRS website are older ATG’s and Market Segment Specialty Program(MSSP’s).Research Credit Claims: Credit for Increasing Research Activities §41: 5/08.Real Estate Property Foreclosure and Cancellation of Debt: 2/15.Ozone Depleting Chemicals (ODC) Excise Tax: 9/07.Obligations Not in Registered Form D: 06/2006.Obligations Not in Registered Form: 6/06.Non-Qualified Deferred Compensation: 06/15.New Vehicle Dealership Audit Technique: 1/05.Low-Income Housing Credit - Guide for Completing Form 8823: 08/2015.IRC § 183: Activities Not Engaged in For Profit: 06/19/09.IRC 162(m) Salary Deduction Limitation: 02/04/05.Executive Compensation - Fringe Benefits 02/04/05.Equity (Stock) - Based Compensation Audit Techniques Guide 08/2015.Entertainment Audit Technique Guide 10/2015.Credit for Increasing Research Activities (i.e.Continuation of Employee Healthcare Coverage 03/2012.Attorneys Audit Technique Guide 03/2011.Art Galleries - Audit Technique Guide 01/2012.Architects and Landscape Architects 08/2011.The revenue agent is also provided with a list of available resources in the IRS database including credit reports, currency transaction reports and information returns provided to the taxpayer by third parties. The ATG’s give the revenue agent guidance on finding publicly available resources on company assets, licenses and litigation history. The audit target will have an advanced view of the issues that will arise in the exam and will be able to better mount a defense. Upon receiving notice of an IRS audit, a prudent taxpayer or their representative should review in depth the ATG for that industry. The guides are an invaluable tool to defend a business taxpayer that is subject to an IRS examination. These ATGs contain examination techniques, common and unique industry issues, business practices, industry terminology and other information to assist examiners in performing examinations. The IRS relies heavily on these guides to assure consistency in its audits. Audit Techniques Guides (ATGs) focus on developing specific guidance for examiners in a particular market segment. The IRS trains its agents on specific audit techniques for different industries and issues.
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