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
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f. Employee Benefits<br />
1) Form 5500?<br />
2) Determination letter?<br />
3) Payment?<br />
g. Rent: Related parties? Disguised dividends?<br />
h. Forms 8300<br />
1) Did you receive any payments over $10,000, as defined for purpose of compliance<br />
with the requirements of Form 8300, for the years in question?<br />
2) Did you file all necessary Forms 8300?<br />
3) Are you aware of the definition of cash? (Cash, traveler’s checks, cashier’s checks.<br />
"Any monetary instrument whether or not in bearer form." Form 8300 instructions.)<br />
i. Prior audits; individuals; entities? Get copies of relevant correspondence, RARs, etc .<br />
j. Copies of all Forms 3115 filed by the dealerships or any related entity.<br />
16. Additional questions to cover the following areas and associated issues should be<br />
developed where appropriate:<br />
a. LIFO conformity (manufacturer statements, creditors, owners)<br />
b. Extent and degree of LIFO comparability (coordinated issue)<br />
c. IRC section 263A organizational chart identifying job positions and descriptions<br />
d. Write downs (accuracy and validity per Treas. Reg. sections 1.471 et. al., Thor Power,<br />
Rev. Rul. 67-107)<br />
e. Existence and economic substance of intangibles, e.g. Covenant not to compete<br />
f. Existence and sale of receivables to a related finance company<br />
g. Existence and flow of funds to a producer-owned reinsurance company (does not have to<br />
be offshore)<br />
h. Types and tax treatment of all sales transactions (deferrals, liabilities)<br />
A-7
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