I have been working on an exam with a client who lives in CT; but the exam originated in Texas. I have been working with the TX auditor via fax and phone (they would not move the exam to CT). The case involved a 1099 where the employer (this was a congressional campaign) included all of the reimbursables on the 1099. The auditor has determined that the food that was brought in to the campaign headquarters for the benefit of the campaign volunteers and totally reimbursed by the campaign should be treated as 50% meals; I’m arguing 100% deductibility. The auditor has been arrogant and even threatening – said if we didn’t accept this he would open the audit further. I am planning on discussing with his supervisor – but I probably need to think about appealing. Would appreciate any thoughts – and any specific guidance you can direct me to for requesting an appeal and writing the appeal. This will be my first appeal. Appreciate any help! Mary Jo
Mary Jo, are there other issues that we need to be concerned with? If so I might try and play nice. If not then I would fax the auditor and their supervisor (always do this in writing), explaining why the food is 100% deductible, and if they disagree you will take the issue to appeals. I would then ask that if they will not consider this issue as you explained it, then they get you a list what else they need so the audit can be wrapped up.
Call their bluff and go to appeals.
You can file a 911 with the advocate, or we can hunt the name down through our connections in DC. Mary Beth Murphy – SB/SE Commissioner – will be at Mohegan Sun with us this week. Send me the auditors name and I will get the manager’s information.