We submitted an amendment via a professional tax preparer for 2006 with deductions we were told we could take. It was transferred to the IRS's Internal Examination dept. (See question I asked yesterday for details) I now know that most of them won't be allowed. Does this mean we will be audited? Or will they just disallow or reject it and that will be the end of it?? The only refund we've collected is from the original return, which i'm positive is squeaky clean. We haven't gotten anything from the IRS that wasn't ours, so will they still try to penalize us? Does the fact that it's been sent to the Internal Exam dept mean that it will be denied?
Sorry for so many questions! The original ? from yesterday was entitled "What does it mean to have your amended return sent to the IRS's internal examination department?'' Or, hopefully, you can look it up using my screen name. Thanks again!
2007-05-23 01:26:47 · 4 answers · asked by joesmama4 2 in Business & Finance ➔ Taxes ➔ United States
Went back and looked at your original question - you got a lot of good advice there.
They'll most likely just disallow most of the deductions, the invalid ones. I hope you didn't pay a lot to the "professional preparer" that led you down this path - they didn't do you any favors. You haven't done something illegal - just followed advice that turned out to be bad.
If the IRS has a large number of returns prepared by this idiot with this same kind of issue, they might go after the preparer, or look more closely at all the returns prepared by them.
Good luck.
2007-05-23 03:18:01 · answer #1 · answered by Judy 7 · 0⤊ 0⤋
Hi, I was one of the people that read and responded to your question yesterday. Now that you know they aren't going to accept the additional deductions, it will probably just disallow the deductions, send you a notice saying your deductions were unallowed with an updated statement on your account (which should be zero), and be done. Since you haven't received any money from them regarding the amended returns, they can't technically penalize you for that. They can't charge you for filing an amended return. The reason it's in the Exam Dept was probably to check for errors regarding the deductions they've already denied you.
However... it's fairly unlikely, but beware they might still try to charge you with filing a fraudulent return. Remember, regardless of who prepared the return, you're still liable for its accuracy. You could argue that you were unaware the deductions the preparer was taking were ineligible. Your tax preparer might have some charges coming to him/her, though. Then again, if it's not a lot of money that you were trying to have refunded to you, and there's no gross omittance of income or anything, they might just let it go.
I really hope everything works out for you.
Hope this helps!
2007-05-23 01:42:43 · answer #2 · answered by starlight_chic06 3 · 0⤊ 0⤋
An amended return is processed just like a regular return. After all, an amended return is just an addition of additional information; or a correction of information already presented. They have to take it apart and make sure all the pieces therein are as they should be. If it appears that it is in line for some kind of fiction writers award then they may say those four words people hate to hear, "We have to talk".
2007-05-23 03:25:56 · answer #3 · answered by acmeraven 7 · 1⤊ 0⤋
What kind of deductions? If the preparer took deductions he/she knew you were not eligible for and you went along hoping for a refund then they could assert fraud. Some unethical preparers are claiming excessive telephone tax and fuel tax refunds. Others claim businesses that don't exist.
2007-05-24 06:47:26 · answer #4 · answered by daoco 4 · 0⤊ 0⤋