Thursday, April 15, 2010

Trend: IRS Auditing Small Business

I was reading my weekly updates from the Associated Locksmiths of America which arrive via email and found an article originally in Forbes by Dean Zerbe, IRS Audits Small Biz More, Big Guys Less . My accountant told me our tax return should be ready some time after 7pm. We’ll drive over, sign on the dotted lines and drop it off at the post office over by the airport like we do every year.

My dad’s been filling out his tax returns for years, doing the math in his head and getting it right; no doubt that gene skipped a generation. I would no sooner file my business tax return without the aid of a certified accountant than I’d represent myself in court without having proper legal council.

“…a new report from Syracuse University's Transactional Records Access Clearinghouse (TRAC) highlights a disconcerting fact. Over the last five years, the Internal Revenue Service has increased the hours it spends auditing small businesses, with less than $10 million in assets, by 30%, while reducing the time it spends auditing large corporations with $250 million or more in assets by 33%. During the same period, audit hours devoted to mid-size corporations ($10 million to $250 million in assets) grew by 13%.”

That’s interesting to me, being one of the smallest fish in the ocean of businesses to come under the never ending tentacles of government scrutiny. I have to jump through hoops and balance the beam in order to keep my State of Texas business license valid and the last thing I need is to worry about being audited or having to keep up with federal tax code changes; that’s why I pay an accountant.

“In the world of ironies, it is certainly eyebrow-raising that the IRS--an agency that wakes up seeking to get more information on you--is extremely reluctant to comply with the Freedom Of Information Act and provide TRAC the statistics underlying this report. It is my understanding from the good folks at TRAC that it took hundreds of FOIA requests and administrative appeals, not to mention two filings with the courts, to get the IRS to cough up this data.”

This is the transparent government promised and yet to be delivered; not much different than Nancy Pelosi telling us that Health Care legislation had to be passed before we could find out what was in it. I’m wondering, not having had a chance to sign this year’s tax return, next to the signature line, will it have “Comrade”; sure feels like an iron fist chokin’ me.

1 comment:

MK said...

This is the unintended but entirely expected out come of giving liberals the power to meddle. Sooner or later they always target the productive and vulnerable little guy in favor of the big and strong.

Oh and they'll tell you with a straight face that they dislike big corporations.