Disputes relating to tax with federal agencies are common for many industries. There are appropriate agencies to redress the grievance. But this requires proper presentation of the
matters relating to tax. Appropriate action should be taken on time so that the disputes do not pile up. We have experts in this field as well. Our support in this area includes:
CRA audits and appeals
Analysis of audit report of retail sales tax/GST/HST.
Tax hearings and appeals
Civil examinations of evasions including investigations relating to tax
Appeals regarding dispute
Compromise of disputes
Trust Fund Recovery Penalty (TFRP)
Tax lien periods including levies
I have yet to meet with someone who loves to receive an audit letter from CRA or IRS. The first letter from IRA normally includes IRS Form 4564, Information Document Request. The first letter from CRA is, most of the times, a standard letter requiring to produce everything you are supposed to have including general ledger, bank statements, minute books, original vouchers, loan agreements, shareholder agreements, and a long list of other items.
The IRS Evidence Gathering Process consists of looking at major expense areas reported on your tax return and seeks the underlying support such as receipts, check copies, bank records and proof of deduction. Audit may start only with one area but can expand to all areas on your tax return, such as reported income and unreported income. The IRS audit (called an "Examination") takes significant time away from your business and family, requiring you to gather mounds of records substantiating each and every item reported on your tax return and develop a comprehensive understanding of tax law.
Obtaining a qualified representative as a CPA or Attorney is always recommended to help you respond to the IRS questions, issues, and requests for documentation. We have represented taxpayers (non-clients and clients) for their individual tax returns and business returns with favorable results over the past 10 years.
The CRA and IRS go out of their way in its mission to determine the accuracy of your tax return. If you don't comply with the Auditors' wishes, the CRA/IRS will recalculate your tax and send you home with a hefty tax bill as your parting gift.
Many taxpayers decide to handle a tax audit themselves, and discover they may have not been very savvy when doing a cost-benefit-analysis; i.e. accountant's fees versus the additional taxes, interest, and penalties.
The Tax Auditors are trained to extract more information from you than you have a legal obligation to provide. CRA and IRS Auditors know that most people are intimated by them and are ignorant of their rights. They don't hesitate to take advantage of your lack of knowledge or breaking nerves.
We try that our clients, except sometimes for the first meeting, the taxpayer are not forced to talk to the auditors once we have been appointed their representative.
A CRA or IRS audit doesn't have to cause havoc to your emotionally or financially. Business should go on as usual.