To Our Clients and Friends: The IRS recently published a new audit guide dealing with specific tax issues that commonly apply to business consultants. The guide is intended as a training manual for IRS examiners. However, it also serves as fair warning to all taxpayers regarding several “issues” the IRS will almost certainly push if you are audited. The IRS is now committed to increasing the percentage of taxpayers that will be audited. As part of this program, you can expect increased emphasis on auditing small business taxpayers.   The IRS is now committed to increasing the percentage of taxpayers that will be audited. As part of this program, you can expect increased emphasis on auditing small business taxpayers. The new audit guide provides some useful guidance about how to avoid problems if you are, in fact, chosen for an audit.  The guide lists the following as potential audit "issues". Travel Expenses Meal and Entertainment Expenses Reimbursed Expenses Lack of Profit Motive Personal Service Corporations Independent Contractor Versus Employee Status We recommend taking this opportunity to identify and improve those areas that could cause trouble if you are subjected to an IRS audit.  We would be pleased to assist you in this project. Please contact us if you have any questions about the new IRS audit guide or what it means for you and your business.