Question

In: Accounting

FACTS:         Bret and Samantha Woodley have been our clients for many years. We have recently concluded...

FACTS:         Bret and Samantha Woodley have been our clients for many years. We have recently concluded an IRS audit of their 2017 income tax returns and the result was an increase in taxable income of $43,750. In our opinion the IRS auditors have ignored the facts in this case and have incorrectly applied the internal revenue code in their conclusions.

ISSUE:           Bret and Samantha Woodley are very upset and worried that they can not afford to pay the increased tax of $16,188. We have told them that this is only the first step. We can always go to appeals and then court if necessary. They have said that appeals is just another arm of the IRS and will just agree with the auditors findings and this amount is too small to incur the costs of litigation. What can we tell them so they are not so worried about fighting this assessment?

CONCLUSION?:

BASIS FOR CONCLUSION?: (Case or litigation from 2019 that backs up conclusion)

Solutions

Expert Solution



Related Solutions

We have had Paige & Gentry as our auditors for many years, haven’t we, Jane? They...
We have had Paige & Gentry as our auditors for many years, haven’t we, Jane? They have been here since I became president two years ago.” “Yes, Bob, I have been the Chief Financial Officer for seven years, and they were here before I came. Why do you ask?” “Well, they were really tough on us during the recent discussions when we were finalizing our year-end audited statements—not at all like I was used to at my last company. When...
Our Understanding of the Facts: Samantha owns a nonresidential commercial building. Prior to 2008, the building...
Our Understanding of the Facts: Samantha owns a nonresidential commercial building. Prior to 2008, the building had been used as office space. In 2008, she leased the entire building to HRV Corporation under a ten-year lease. HRV intended to use the building as an audio and video production studio. The lease specified that at the end of the lease term (2018), HRV had to restore the building to its original condition if any modification were made. During the lease term...
Question 1: Opioids have been used as our first line defence against pain for many years....
Question 1: Opioids have been used as our first line defence against pain for many years. In class, we discussed the need for opiods in society but also the potential dangers associated with these powerful drugs. Explain how opioids can be used to treat pain. What are the mechanisms at play? What locations in the CNS are most important in the context of pain? Explain why opioids can be used to self-medicate for psychological/emotional pain as well as physical pain....
At no time in our history have we been more medicated as a society than we...
At no time in our history have we been more medicated as a society than we are today. Yet one study has shown that 75% of pediatricians are NOT confident in diagnosing ADD/ADHD, let alone psychiatric conditions. Meanwhile, access to specialized services, especially for children, are practically nonexistent. Chapter 7 discusses several cognitive and psychiatric conditions, many of which are often treated with medication. Pretend you are the parent of a child with one of these conditions. You would want...
For many years businesses have struggled with the rising cost of health care. But recently, the...
For many years businesses have struggled with the rising cost of health care. But recently, the increases have slowed due to less inflation in health care prices and employees paying for a larger portion of health care benefits. A recent Mercer survey showed that 52% of U.S. employers were likely to require higher employee contributions for health care coverage. Suppose the survey was based on a sample of 700 companies. Compute the margin of error and a 95% confidence interval...
For many years businesses have struggled with the rising cost of health care. But recently, the...
For many years businesses have struggled with the rising cost of health care. But recently, the increases have slowed due to less inflation in health care prices and employees paying for a larger portion of health care benefits. A recent Mercer survey showed that 52% of U.S. employers were likely to require higher employee contributions for health care coverage. Suppose the survey was based on a sample of 600 companies. Compute the margin of error and a 95% confidence interval...
For many years businesses have struggled with the rising cost of health care. But recently, the...
For many years businesses have struggled with the rising cost of health care. But recently, the increases have slowed due to less inflation in health care prices and employees paying for a larger portion of health care benefits. A recent Mercer survey showed that 52% of U.S. employers were likely to require higher employee contributions for health care coverage. Suppose the survey was based on a sample of 600 companies. Compute the margin of error and a 95% confidence interval...
Our company has been a very profitable company for many years. Currently, they are considering investing...
Our company has been a very profitable company for many years. Currently, they are considering investing in a new project that will last three years. The project will require an immediate capital expenditure of $900,000 which will be fully expended this year as is now allowable under the new tax law. Our company estimates that the revenues from this project will be $500,000 during the first year and that the revenues will grow at a rate of 10% per year....
In our society, we have people from many other countries with many different backgrounds, education, culture,...
In our society, we have people from many other countries with many different backgrounds, education, culture, and skills. As such, they can be identified in many different diverse group sets. Diversity is referred to as, “A characteristic of a group or organization whose members differ from one another along one or more important dimensions, such as age, gender, or ethnicity” (Griffin, 2016, p. 244). As businesses hire people to help in the manufacturing of goods or the provision of services,...
The television show Law & Disorder has been successful for many years. That show recently had...
The television show Law & Disorder has been successful for many years. That show recently had a share of 23, meaning that among the TV sets in use, 23% were tuned to Law & Disorder. Assume that an advertiser wants to verify that 23% share value by conducting its own survey, and a pilot survey begins with 13 households have TV sets in use at the time of a Law & Disorder broadcast. Find the probability that none of the...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT