IRS Audit for Amended Return?
I have a small business (restaurant). My 2005 tax returns were totally off. Gross sales and COGS were off 110% ($50K to110K and 26K to 55K), and lots of deductions were not included. This is a family business and my brother did the returns and totally screwed up. The old 2005 return paid the IRS $350. With the amended returns, I'm going to be paying them $1300. The amended return numbers are pretty similar to my past returns. I'm really paranoid because I'm afraid this might trigger an audit
Public Comments
- Not filing the amended return will more likely trigger an audit than fixing the error.
- Only about 1% of returns get audited. Your amended return will say, there was a mistake and I caught it first.
- You will be paying them $950 more with the amendment and they may want some interest. That is likely the last you hear about it. If you can support the numbers on the amendment why worry about an audit. In most cases if you are not trying to do something wrong an audit is no big deal other than the time it take to prepare.
- In your case it is always better to file amended return.
- It might, but if it was an honest mistake (relying on your brother to do the taxes was a mistake) and you are trying to correct it, the audit will not be that scary. Just do the ammended returns for the past 3 years and pay the tax. If you can't afford to pay the tax then make a payment plan. As long as you can pay all your tax, penalties and interest within 10 years, the IRS will probably not bother you. If you do get audited, hire a tax attorney to help you.
