Tips for Taxpayers in Responding to the IRS's Request Electronic Files in an IRS Audit

During an IRS tax audit of your South Florida business, do you have to give the IRS your electronic files when the auditor requests the entire original backup of the QuickBooks file?

As discussed in our previous Florida Tax Attorney Blog on this subject, the IRS has expansive authority in requesting electronic files and software from you, the taxpayer, during an examination. These electronic files can include the original backup files of electronic accounting software, such as Quickbooks.

While this authority has been challenged by taxpayers and practitioners alike, it has been done so to no avail. While you must be responsive to the IRS's requests, often in the form of an Information Document Request or IDR, during an audit, you must also take care to provide no more data than the IRS's request reasonably covers.