During the initial conversation, the auditor discusses the taxpayer’s business and operations and determines requisite documentation. The auditor schedules an appointment to begin the audit and lists the records that may be needed.
Documentation
Auditors by law may examine a taxpayer’s books and records to determine the accuracy of taxes paid.
Taxpayers must furnish all necessary records requested including, but not limited to, the following documents:
- Sales invoices, along with any current resale and exemption certificates
- Purchase invoices, capital asset invoices and depreciation schedules
- General ledgers, other ledgers and subsidiary journals
- Charts of accounts and financial statements reflecting profit and loss
- Federal income tax information
- Bank statements
- Working papers and accounting data used to prepare tax reports
- Electronic data, if available
- Documentation supporting overpaid tax
- Documentation supporting credits taken on returns
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