Post: Auditor says 2010 return will be audited

Posted by Barbara on 6/22/09

During an audit this morning, the auditor told my client
that her 2010 return "would" be audited and that he would
provide her with a notice to that effect after her 2007
audit was completed. He also told my client that she
would be subject to a 75% fraud penalty if her 2010 return
contained the same issues as her 2007 return.

She took deductions for capital improvements as repairs
and lacks several receipts for her deductions but the
overall change in tax liability is going to be less than a
$1000.

This is the first time I have had an auditor threaten a
client with a guaranteed future audit and with a 75%
penalty rather than the 40% gross negligence penalty and
I've dealt with much worse problems.

Anybody had any experience with this? And if so, what did
you do?

Posts on this thread, including this one

Auditor says 2010 return will be audited, 6/22/09, by Barbara.