Assignment 5: Audit Letter to IRS
Due Week 10 and worth 160 points
You are a CPA working as a tax professional and have been hired by a client who comes to you with a letter from the IRS indicating that it is auditing several items on the client’s tax return and making the following assertions:
- The method the client used to value foreign currency exchanges is incorrect.
- An undervalued international exchange of appreciated property should show a larger gain.
- Sales through export operations were underreported and revenue is understated.
- The transfer of intangible property for stock was undervalued and results in a larger gain.
- Investments made to another country were done through a subsidiary and not a branch and are taxable as such.
Using the Internet or Strayer databases, research the rules regarding the above types of transactions.
Write a one to two (1-2) page paper in which you:
- Respond to the assertions by the IRS and counter those assertions with your own. Provide support for the rationale used in the response.
- Make a convincing argument that the information / documentation your client possesses justifies and supports the client’s claim. Provide supporting evidence for your argument.
- Use at least two (2) quality resources in this assignment. Note: Wikipedia and similar Websites do not qualify as quality resources.