Correspondence Audit

Correspondence Audit

An examination of the accuracy of a taxpayer's income tax return conducted through the mail by the Internal Revenue Service, which sends the taxpayer a request for proof of a particular deduction or exemption taken by either completing a special form or sending photocopies of relevant financial records.

A correspondence audit is distinguishable from a field audit and an office audit in the manner in which it is conducted.

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* Correspondence audit. These audits are the most common.
(19) For taxable years 1996 to 2003, the field audit category is broken up into various subcategories, such as Revenue Agent, Tax Compliance Officer, and Tax Examiner audits, along with differing labels for correspondence audits. I consolidate all former audits into the field audit category, and associate correspondence audits under previous names with the correspondence audit category for these years to keep the data nomenclature consistent.
According to the posting, attributed to Alana Stewart, president of the foundation, the State of California is conducting a "correspondence audit."
"If the IRS thinks you made a minor mistake, they'll send a paper or correspondence audit. The triggers of a paper audit can be large charitable deductions, large itemized deductions, and mileage logs.
(Similarly, we do not believe the period of time to respond to a correspondence audit should be generally extended.) Rather, we believe that the extraordinarily complicated nature of, and necessarily large dollar amounts associated with, large-case audits justify lengthening of the protest period.
Unlike a field examination, a correspondence audit is not assigned to a specific examiner.
First, you may have received a simple correspondence audit in which the IRS asks about a particular deduction or calculation on your return.
If an item questioned on a correspondence audit is complex or requires an explanation in addition to documents, the taxpayer may, if he wishes, request an office interview.
While the IRS generally relies on correspondence, field, and office audits of taxpayers' returns, the correspondence audit is the IRS's examination workhorse.
The correspondence audit resulted in an average assessment of about $161,000 per return.
A third is that the IRS was "overly optimistic" as to the types and numbers of compliance issues that it could handle via correspondence audit.
Because the audit rate of large corporate taxpayers is high, an IRS issues and correspondence audit file will usually be established.

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