In a recent article by Laura Saunders of the Wall Street Journal called Small Businesses Fight IRS over Data, the news that the IRS is asking companies they are auditing to hand over electronic records that they store in their business software programs. (Source: a letter from an agency official to the American Institute of CPAs).
According to the article the fear from the American Institute of CPAs “fears this will force small businesses to turn over customer lists, personnel data, confidential client information and other unrelated information often contained in the off-the-shelf software programs many businesses use to manage all aspects of their finances.”
The big concern for small businesses to ponder is what could be done with the records. As the article states, “Small-business advocates said that if a company turns over its complete electronic records, there is no way of knowing what the IRS might do with it. Typically the agent takes the file offsite to examine it using IRS software, Mr. Snow says. ‘This is creating angst in the minds of small-business owners,’ said Giovanni Coratolo, a small-business expert with the U.S. Chamber of Commerce. ‘When you give that much data, it opens the doors to mischief.’”
Read the full article on why Small Businesses Push Back on IRS request for Electronic Files and remember….don’t mess with taxes! Stay educated!
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