OUTLOOK & ANALYSIS

The IRS and Big Data Gone Bad

Bookkeeping data is notoriously unreliable. So why is the IRS relying on it?

The Ten-Minute Bookkeeping Test (PDF)
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The 10-Minute Bookkeeping Test

By Frank Stitely
SK CPAs

“Please give me a copy of your 1099-MISC forms.”

The IRS agent was a 25-year-old woman, with only a couple of years of experience dealing with my client.

My client was the “How-dare-you-question-me?-I’m-a-taxpayin’,-God fearin’-American” type of client – one of those guys  who think the Marlboro Man is a wimp.

But he had a tax problem. He was being audited and he had thrown out all of his paper records when he moved his office.

Missing 1099-MISC

He didn’t have copies of his 1099-MISC forms.  So he had his bookkeeper reprint them from QuickBooks.  I gave them to the IRS agent.

“Mr. Stitely, these 1099 forms don’t match what we have in our records.”