I'm Thinking About Requesting A IRS Tax Audit

JustDave

JustDave

Well-known Member
Sounds Bonkers, but here's why. I have used Turbo Tax for about 5 years. I find some of the questions they ask confusing. I actually don't understand a few of them. Questions about numbers I fully understand. Math is precise that way. It's just basic arithmetic, anyway.

I don't have one problem paying what I owe, and I never cheat on my taxes. It's more work than being honest. Sometimes the government has sent me money back when I overpay. Sometimes I owe them more and I pay it without a gripe. Although neither of those things happen frequently.

So this year I used Turbo Tax again, and it seems like it got unnecessarily even more complicated. So before I paid them, I just took my documents to a local tax preparer, and paid them to do it for me. On my state taxes, we were within pennies of each other. But on my Federal taxes the local firm said I owed $1,175 additional taxes, while Turbo Tax came up with a $1,015 refund. That's a $2000 difference!

The local firm had finished my taxes, but said I couldn't have my copies for two weeks, because they had to record them, or something. Record to who? I didn't ask; My bad. But I went home and did Turbo Tax a second time being as careful as I could and came up with the same result that I had the first time. Obviously, I will file with Turbo Tax, and end up paying for both services. I actually don't mind. I'm looking at it as an education.

I'm not looking for a fight with anyone, but I do want clarity. The IRS seems like the best available arbitrator to me. Now if the local tax preparer records their findings with the IRS and Turbo Tax also files, I see confusion ahead. The local preparer will file (maybe, but I'm not sure) but I won't pay that way. Turbo Tax will tell the IRS they need to refund me. IRS will get confused. I don't want to confuse the IRS. It's not nice to confuse the IRS. It might be as disconcerting for them as it is for me.

I was actually audited years ago once. I went to the audit terrified, but left clean as a whistle and happy as a clam. The auditor said, "Well, you owe a little here and overpaid a little there. Let's call it even!" I will get more clarity from the preparer when I talk to them again about what it is exactly they will be doing in the next two weeks with my documents. I don't know, maybe they are required to report anything they do, regardless of me filing on my own.

I'm actually considering requesting an audit, but for my piddling income, I might be more of a pest to the IRS than an honest tax paying citizen.

Addendum: The preparer actually double checked their original outcome when I commented it was much higher tax debit than I ever had before. On their second try by a different person in the office, it was $400 lower, but still far apart from my work. I will not complain to them. That's not what this is about.
 
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I received a notice of audit once and it said I would be contacted with details. I never heard anything again. I can't imagine what would have been wrong as my taxes are simple and I'm always perfectly honest about it.

Even the year I got TWO tax refund checks (I HAD made a small mistake and filed an amended return ONE DAY LATER, marking the envelope AMENDED RETURN and writing AMENDED RETURN at the top of the return, as I was instructed to do). I couldn't get anyone at IRS to tell me what to do with the incorrect check. They said hold onto it until I am notified to send it back.

I called IRS monthly for a solid year asking when they were going to tell me what to do with the check. Same response every time. So, finally, I sent it back to them via certified mail and never heard another thing. I still wonder what would have happened if I had cashed the incorrect check......
 
Dave, ask the private company to not send in their version of the form. Tell them you’ll do it yourself and then don’t.
 
Hey, @JustDave... I appreciate your personal integrity and determination to simply
understand the basics of this issue! I think that it's noteworthy when I meet folks like
yourself... as I've seen these characteristics in you/your posts.

Anyway, I do think that requesting an actual audit might cause additional confusion
the confusion you may have already started through whatever the local preparer and
TurboTax may have caused. (haha, that sounded confusing as I was typing).

Anyway, I went ahead and asked "Bing":
Can you go to the IRS for advice and guidance?
Bing/CoPilot said:

Yes

Can you go to the IRS for advice and guidance?​

Yes, you can go to the IRS for advice and guidance. The IRS offers a variety of resources and assistance options for taxpayers. You can get help online, by phone, or in person. The IRS provides free tax return preparation for qualifying taxpayers, and you can find your local office or schedule an appointment for in-person assistance. The IRS also offers professional interpreters for Spanish, Mandarin, Cantonese, Korean, Vietnamese, Russian, and Haitian Creole. If you have specific questions or need help with a particular tax issue, the IRS can provide the necessary guidance and support.

IRS+2
 
Jules said:
Dave, ask the private company to not send in their version of the form. Tell them you’ll do it yourself and then don’t.
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I've been thinking about this. I will use their return for the state since we are only pennies apart. That way I can save a few bucks when I only pay Turbo Tax to do my Federal return.
 
Jules said:
Dave, ask the private company to not send in their version of the form. Tell them you’ll do it yourself and then don’t.
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I actually told them I wanted to send it all in myself, but the woman said something about, "We still have to hold them for two weeks while we......." At which time I was still processing the fact that I could not have my information right then. I did ask her to make copies of my 1099 Rs, which she did. I needed those to finish my Turbo Tax comparison. I was more interested in getting those copies than I was in understanding why she needed to keep the work for two weeks. I'd already paid her.

I'll try to straighten this up on Monday.
 
Aunt Bea said:
I would tend to trust turbo tax more than a random tax preparer.

I say leave well enough alone, the IRS will contact you if they feel that you have made an error or owe additional taxes.
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I've been wondering who is more accurate too. Local vs Turbo Tax? But Turbo Tax is actually me since I'm the one who gives them the numbers and answers their questions. But I do think I've done it correctly, but a local preparer has way more experience than I do, so I'm inclined to question my accuracy too.
 
Ted01 said:
Hey, @JustDave... I appreciate your personal integrity and determination to simply
understand the basics of this issue! I think that it's noteworthy when I meet folks like
yourself... as I've seen these characteristics in you/your posts.

Anyway, I do think that requesting an actual audit might cause additional confusion
the confusion you may have already started through whatever the local preparer and
TurboTax may have caused. (haha, that sounded confusing as I was typing).
Click to expand...
Yeah, but I still understand you.
 
JustDave said:
I've been wondering who is more accurate too. Local vs Turbo Tax? But Turbo Tax is actually me since I'm the one who gives them the numbers and answers their questions. But I do think I've done it correctly, but a local preparer has way more experience than I do, so I'm inclined to question my accuracy too.
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I’m not so sure that’s a fair statement.

If your numbers are accurate, I would trust turbo tax and if you have made some innocent error in interpreting the instructions the IRS may contact
you with questions, revised numbers, etc… but I wouldn’t seriously worry too much about it.
 
I would not request a tax audit from the IRS. This can trigger unexpected complications, including a 6 year look back.

Probably, I would first clarify what steps the private preparer has taken in regard to your personal information, to insure nothing has (yet) been filed with the IRS.

Then, I would sit down with the preparer and go over the discrepancies just as you have with us and ask him to explain it to your satisfaction.

If by chance the private preparer has already filed the return, then discovers that they made an error after the fact, they can file an amended return.
 
The local tax preparer was open today. I told them not to file my Federal, but state was fine. Remember, yesterday I asked to take their forms and mail them myself, and they said I couldn't. Turns out they had submitted the forms electronically yesterday after I had requested them. I cannot submit my forms now, because the IRS would automatically reject my forms. Or so I was told.

I didn't argue. I'll pay the extra money to the IRS, and stick with Turbo Tax next year. I will also go through my Turbo Tax preparation one more time. They are not allowing me to see their work for two weeks. It's possible the IRS could send me a refund 6 months from now. It's happened before. I may request an audit, but I'm tired of this at the moment. The money is not the big issue here. Above all, I'd like to understand the discrepancy.
 
JustDave said:
The local tax preparer was open today. I told them not to file my Federal, but state was fine. Remember, yesterday I asked to take their forms and mail them myself, and they said I couldn't. Turns out they had submitted the forms electronically yesterday after I had requested them. I cannot submit my forms now, because the IRS would automatically reject my forms. Or so I was told.

I didn't argue. I'll pay the extra money to the IRS, and stick with Turbo Tax next year. I will also go through my Turbo Tax preparation one more time. They are not allowing me to see their work for two weeks. It's possible the IRS could send me a refund 6 months from now. It's happened before. I may request an audit, but I'm tired of this at the moment. The money is not the big issue here. Above all, I'd like to understand the discrepancy.
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Take a look at turbo tax, you should be able to file an amended return if you find the discrepancy is in your favor. You could also ask the tax preparer to file it but their fees may not make it worthwhile.

Good luck!
 
JustDave said:
On my state taxes, we were within pennies of each other. But on my Federal taxes the local firm said I owed $1,175 additional taxes, while Turbo Tax came up with a $1,015 refund. That's a $2000 difference!
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Could one of the Federal taxes have used the standard deduction and the other itemized deductions? Could you have qualified for a federal tax credit (child, education, energy, etc)?

Maybe you entered a 1099-INT (income) accidentally as a 1099-B (capital gains)?

I always use the dinkeytown free 1040 tax calculator to sanity check results.
1040 Tax Calculator
 
Why not just hire an independent CPA to review the work of the Firm that you used vs your own calculations.

Based on what we pay our CPA to prepare our taxes - i am guesstimating it would be in the ballpark of $500 to $1K or so ish...

But a CPA would give you a better estimate once you called and explained.

We do our best to pay our taxes - just like you do. But I would be reluctant to ask the IRS into my life anymore than necessary. But that's just me.

Peace of Mind is a worthwhile thing for sure.

I am interested in the outcome. So please follow up with the rest of the story !
 
gamboolman said:
I am interested in the outcome. So please follow up with the rest of the story !
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It may be awhile. There are still possible outcomes. The IRS has accepted the forums, but from past experience, if they do an actual random review, I won't know about it until June or July.
 
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I used to do my taxes with paper and a pencil. There is an advantage there in that you can actually see how your tax issue is solved. That's not as easy with Turbo Tax, because you just feed numbers into it, which are "crunched" out of your sight. There is something like a logical progression that you can watch when doing it with paper and pencil. I think that would be my next step. It would allow for greater clarity. It's drudgery of course, but not mysterious. That's why we turn our taxes over to others to do for us.
 
This morning I carefully went through Turbo Tax's Federal filing process one more time. The tax refund was the same. I did change two entries to questions I didn't understand, although they did sound irrelevant to my situation, but it didn't change the outcome. I followed it all the way to where it's time to give them my credit card and just before that, they gave me a one page summary showing a summary of taxable:
_____________
interest,
dividends,
capital gains,
pensions

Standard $17,750 deduction
Senior $6,000 deduction
Withholdings

Refund ($1,105)
______________

I took a snapshot and printed it out. I'll take that to the guy that did my taxes. Yesterday he showed me three figures upon which he calculated everything. I couldn't remember them from Turbo Tax off the top of my head, so they didn't mean anything to me at the time. Now we have something we can compare, which may help. As one would expect, the company is assuming my figures are incorrect, but wouldn't show me where I'm wrong unless they could see the Turbo Tax results, while they won't let me see what they have done, other than those 3 numbers I mentioned. And all I'm trying to do is just figure out what is going on. I don't care who's wrong.

What I have now is the best I can do unless I pay Turbo Tax to file (the last step), which will cost me $79, at which time I would get printouts of everything filed. But according to the local outfit, Turbo Tax cannot file on top of already submitted documents.

The good news is I'm past that ugly feeling of confusion, and seeing this whole thing as a comical absurdity. And that actually feels like relief. I think it's more than temporary, too. I'm willing to pay $1,015 and forfeit a $1000 refund just to get this all behind me.
 
Unless you have a very specific detailed question with a line number or publication I would try submitting an amended return with the new numbers. Note where the mistake or discrepancies were so you can answer their questions

I'm a glutenn for punishment and have done things manually and have had to submit 6-8 pages because they want to see everything including worksheets even though they're not a form. Maybe a manual preparation might help, print out ANY form and worksheet involved and see what you get.

Good Luck
 
WhatInThe said:
Unless you have a very specific detailed question with a line number or publication............... Note where the mistake or discrepancies were....
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Already there! Those three figures he showed me, one being total income, which I remembered, but meant nothing to me at the time, I compared to the printout. Big difference, and my mistake.

When I was filling this stuff in I added my income from Social Security, and correctly, I might add, but somewhere along the line I clicked on one of those trash can icons and deleted all further references to Social Security from the calculations. <beat head with fist> Now my tax due matches the local preparer to the dollar.

Do I feel stupid? Yes, absolutely, but overwhelmed with a sense of relief. Emotionally, I'll call that a draw in the fight between two parts of my brain, and I will tell that local outfit that I'll be back next year, if they'll have me. They charge $59 less than Turbo Tax. :)
 
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JustDave said:
When I was filling this stuff in I added my income from Social Security, and correctly, I might add, but somewhere along the line I clicked on one of those trash can icons and deleted all further references to Social Security from the calculations. <beat head with fist> Now my tax due matches the local preparer to the dollar.
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Ah, so apparently your state doesn't tax Social Security and that is why the state return amounts matched.

So nice to have the mystery cleared up.
 
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