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The length of each audit varies depending on the type of audit, the complexity of items being reviewed, the availability of information being requested, the availability of both parties for scheduling of meetings and your agreement or disagreement with the findings.
Audits can also be initiated as a result of information received from the outside sources During the examination, if the auditor finds that your records indicate possible reporting errors, the auditor can utilize their many different audit methods such as mark-up method, sample basis audit, observation test at your business premises, and etc.
Under the California Revenue and Taxation Code, any person who evades the reporting, assessment or payment of sales taxes that would otherwise be due may be guilty of sales tax evasion.
IRS will also look for any signs of inconsistency such as lifestyle habits for signs of unreported income by reviewing records, asking probing questions, and etc.
An IRS audit is a review/examination of an individual’s or organization's or accounts and financial information to ensure information is being reported correctly, according to the tax laws, to verify the amount of tax reported is accurate.