NASSAUSUFFOLK

This message has been cross posted to the following Discussions: ncCPAp on the GO! and NASSAUSUFFOLK .
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I have a client who is a musician.  As such, he receives many 1099M's.  I typically request a transcript from the IRS which details the 1099's received and compare the transcript with the 1099's provided to me.  If there are additional 1099's on the transcript, I include them in income. 

In 2012, I relied on the additional detail found in the transcript to prepare the client's Schedule C.  The IRS listed one vendor with an amount. of $10,000. Recently, my client received a notice listing the vendor, but the amount differed from what had been presented on the transcript.  

I wrote a letter of explanation and included the pertinent pages of the transcript.  The response states that the letter did not state the reasonable cause necessary to waive the accuracy related penalty due to negligence.  

Any suggestions??

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Barbara Franco
CPA
FRANCO, PARES & EPSTEIN, CPAs
Levittown NY
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I would inform the IRS you used information issued by the IRS and their information was faulty thus the accuracy related penalty should be removed because you relied on incorrect (false)  information from the IRS.
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Donald Ingram
CPA
DONALD INGRAM, CPA
Plainview NY
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Original Message:
Sent: 12-22-2014 16:17
From: Barbara Franco
Subject: accuracy related penalty

This message has been cross posted to the following Discussions: ncCPAp on the GO! and NASSAUSUFFOLK .
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I have a client who is a musician.  As such, he receives many 1099M's.  I typically request a transcript from the IRS which details the 1099's received and compare the transcript with the 1099's provided to me.  If there are additional 1099's on the transcript, I include them in income. 

In 2012, I relied on the additional detail found in the transcript to prepare the client's Schedule C.  The IRS listed one vendor with an amount. of $10,000. Recently, my client received a notice listing the vendor, but the amount differed from what had been presented on the transcript.  

I wrote a letter of explanation and included the pertinent pages of the transcript.  The response states that the letter did not state the reasonable cause necessary to waive the accuracy related penalty due to negligence.  

Any suggestions??

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Barbara Franco
CPA
FRANCO, PARES & EPSTEIN, CPAs
Levittown NY
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You should consider the QAR option (Qualified Amended Return) filing.  It would address the Accuracy penalties and can be used as a mechanism to likewise address the other penalties as well.

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Eric Morgenthal, Esq., CPA, MS (Taxation)
LAW OFFICE OF ERIC L. MORGENTHAL, PLLC
Melville NY
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Original Message:
Sent: 12-23-2014 10:41
From: Donald Ingram
Subject: accuracy related penalty


I would inform the IRS you used information issued by the IRS and their information was faulty thus the accuracy related penalty should be removed because you relied on incorrect (false)  information from the IRS.
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Donald Ingram
CPA
DONALD INGRAM, CPA
Plainview NY
-------------------------------------------


Original Message:
Sent: 12-22-2014 16:17
From: Barbara Franco
Subject: accuracy related penalty

This message has been cross posted to the following Discussions: ncCPAp on the GO! and NASSAUSUFFOLK .
-------------------------------------------
I have a client who is a musician.  As such, he receives many 1099M's.  I typically request a transcript from the IRS which details the 1099's received and compare the transcript with the 1099's provided to me.  If there are additional 1099's on the transcript, I include them in income. 

In 2012, I relied on the additional detail found in the transcript to prepare the client's Schedule C.  The IRS listed one vendor with an amount. of $10,000. Recently, my client received a notice listing the vendor, but the amount differed from what had been presented on the transcript.  

I wrote a letter of explanation and included the pertinent pages of the transcript.  The response states that the letter did not state the reasonable cause necessary to waive the accuracy related penalty due to negligence.  

Any suggestions??

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Barbara Franco
CPA
FRANCO, PARES & EPSTEIN, CPAs
Levittown NY
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