Auto Dealerships - Audit Technique Guide - Uncle Fed's Tax*Board
Auto Dealerships - Audit Technique Guide - Uncle Fed's Tax*Board Auto Dealerships - Audit Technique Guide - Uncle Fed's Tax*Board
Y E A R E N D EXAMPLE OF DEALERSHIP OWNERSHIP T Y P E C A U T O D E A L E R S H I P F I N A N C I A L S T A T U S Dealership Make Chevrolet Ford Subaru Saturn Infiniti B M W Porsche/Audi Filing Form 1065 1120 S 1065 1120 S 1120 S 1120 S 1065 Assets $3,000,000 $2,000,000 $1,000,000 $8,000,000 $20,000,000 $5,000,000 $1,000,000 Gross Receipts $12,000,000 $10,000,000 $3,000,000 $5,000,000 $100,000,000 $15,000,000 $1,000,000 Profit/Loss ($1,000,000) $0 $0 ($1,000,000) $3,000,000 ($2,000,000) ($1,000,000) Capital Account ($2,000,000) $0 ($1,000,000) $1,000,000 $8,000,000 ($1,000,000) ($1,000,000) Owners Asset Investment Real Estate Owner’s Insurance Holding Corp. Corporation Corporation Living Trust Subsidiary Form 1120S Form 1120S Form 1120S Form 1120PC Assets/Liabilities $30,000,000 $10,000,000 $15,000,000 $30,000,000 $35,000,000 Income $1,000,000 $1,000,000 $1,000,000 $5,000,000 $25,000,000 Profit/Loss ($2,000,000) ($1,000,000) ($2,000,000) $0 ($5,000,000) Paid in Capital/Stock $15,000,000 $5,000,000 $1,000,000 $10,000,000 $20,000,000 Retained Earnings $4,000,000 $1,000,000 $3,000,000 $5,000,000 $10,000,000 Owner 1040 AGI $2,000,000 TI $1,000,000 1-11
Conclusion "Financial status" is one of the keys to planning any auto dealership examination. Such preplanning will aid in enabling the agent to determine the scope of the audit. Work papers should clearly demonstrate answers to feasibility questions regarding the taxpayer’s ongoing business. The next section will offer guidelines on how this information can be obtained. 1-11
- Page 1 and 2: Internal Revenue Service Market Seg
- Page 3 and 4: Preface One of the goals envisioned
- Page 5 and 6: Table of Contents Preface .........
- Page 7 and 8: The Reinsurance Transaction .......
- Page 9 and 10: Part 1 General Focus and Procedure
- Page 11 and 12: 1. Type A Return Information Schedu
- Page 13 and 14: Percentage has gone down. The incre
- Page 15 and 16: the principal shareholders to finan
- Page 17: Rents $ 500,000 Interest $ 50,000 C
- Page 21 and 22: Chapter 2 Getting Started The key t
- Page 23 and 24: entities and their purpose and rela
- Page 25 and 26: It is recommended that officer comp
- Page 27 and 28: Chapter 3 Standard Audit Index Numb
- Page 29 and 30: Chapter 4 Books and Records Charact
- Page 31 and 32: c. Reconcile (2): Beginning Trial B
- Page 33 and 34: 3 Repair Order Sales 4 Parts Sales
- Page 35 and 36: Conclusion Although intimidating at
- Page 37 and 38: Chapter 5 Balance Sheet Why do we c
- Page 39 and 40: When an adjustment to a balance she
- Page 41 and 42: Part 2 Inventory Chapter 6 General
- Page 43 and 44: . Purchasing c. Handling, processin
- Page 45 and 46: dealerships use specific identifica
- Page 47 and 48: Chapter 7 LIFO Background Overview
- Page 49 and 50: A Short History of LIFO Application
- Page 51 and 52: improper inflation through unwarran
- Page 53 and 54: Introduction Chapter 8 Computing LI
- Page 55 and 56: The double extension index formula
- Page 57 and 58: as one item, there would probably n
- Page 59 and 60: (existing items) and non-comparable
- Page 61 and 62: The current-year costs that can be
- Page 63 and 64: Assuming the dealership elects LIFO
- Page 65 and 66: matching of revenues and costs. Thu
- Page 67 and 68: section 1.471-9. Both of these regu
Y E A R E N D<br />
EXAMPLE OF DEALERSHIP OWNERSHIP<br />
T Y P E C A U T O D E A L E R S H I P<br />
F I N A N C I A L S T A T U S<br />
Dealership Make Chevrolet Ford Subaru Saturn Infiniti B M W Porsche/Audi<br />
Filing Form 1065 1120 S 1065 1120 S 1120 S 1120 S 1065<br />
Assets $3,000,000 $2,000,000 $1,000,000 $8,000,000 $20,000,000 $5,000,000 $1,000,000<br />
Gross Receipts $12,000,000 $10,000,000 $3,000,000 $5,000,000 $100,000,000 $15,000,000 $1,000,000<br />
Profit/Loss ($1,000,000) $0 $0 ($1,000,000) $3,000,000 ($2,000,000) ($1,000,000)<br />
Capital Account ($2,000,000) $0 ($1,000,000) $1,000,000 $8,000,000 ($1,000,000) ($1,000,000)<br />
Owners Asset Investment Real Estate Owner’s Insurance<br />
Holding Corp. Corporation Corporation Living Trust Subsidiary<br />
Form 1120S Form 1120S Form 1120S Form 1120PC<br />
Assets/Liabilities $30,000,000 $10,000,000 $15,000,000 $30,000,000 $35,000,000<br />
Income $1,000,000 $1,000,000 $1,000,000 $5,000,000 $25,000,000<br />
Profit/Loss ($2,000,000) ($1,000,000) ($2,000,000) $0 ($5,000,000)<br />
Paid in Capital/Stock $15,000,000 $5,000,000 $1,000,000 $10,000,000 $20,000,000<br />
Retained Earnings $4,000,000 $1,000,000 $3,000,000 $5,000,000 $10,000,000<br />
Owner<br />
1040<br />
AGI $2,000,000<br />
TI $1,000,000<br />
1-11
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