Help With IRS Letters, Sales Tax and Workers' Comp Audits in San Jose, CA
We read the letter, get the records in order and prepare the response. If you need a CPA or enrolled agent, we tell you up front.
A letter from the IRS, a sales tax audit notice from the CDTFA, or a workers' compensation premium audit from your insurer all have one thing in common: the person reading it usually has no idea how serious it is. Tower Accounting has helped San Jose business owners and families deal with these letters since 2000. We read the letter, tell you in plain English what it means and when it is due, and get the records and the response ready.
We are also straight with you about who should handle what. Ray Torres is a registered tax preparer, not a CPA or enrolled agent. Most notices and business audits are records problems, and that is exactly what we fix. When a case needs someone with full IRS representation rights, we say so on day one and help you get organized for that person.
Letters and audits we help with
- IRS notices such as CP2000 income matching, CP14 balance due, and letters questioning a deduction or credit. We explain the notice, gather the support, and prepare the written response.
- California Franchise Tax Board notices, including requests for information and head-of-household verifications.
- CDTFA sales and use tax audits for restaurants, retail, auto repair, contractors and anyone who collects California sales tax. We reconcile reported sales to the books and bank and prepare what the auditor asks for.
- EDD payroll tax questions, most often about whether workers were correctly treated as employees or independent contractors.
- Workers' compensation premium audits from the insurance carrier, especially for construction and trades with subcontractors.
- Payment plans. When a balance is owed, we work out the numbers and help you prepare a payment plan request you can actually keep up with.
How it works
- Read the letter together. Bring it in or email a photo. We identify the agency, the issue, the tax year and the deadline, and tell you whether this is a one-letter fix or something bigger.
- Assemble the records. We pull what the agency or auditor will ask for and reconcile it to the return. If the books for that year are a mess or do not exist, we rebuild them.
- Prepare the response. We draft the written response and organize the support so it answers exactly what was asked, with nothing extra.
- Know when to bring in help. If the case moves to appeals, collections or anything that needs an enrolled agent, CPA or tax attorney, we tell you plainly and hand that professional an organized file.
- Fix the cause. Most letters come from records problems. We make sure next year's books and returns do not produce the same letter.
Why the records decide the outcome
Auditors assess on estimates when the records are thin
A sales tax auditor who cannot reconcile your deposits to your reported sales will estimate sales using a markup on purchases, and the estimate is almost never in your favor. A workers' comp auditor who cannot see certificates of insurance for your subcontractors will charge premium on every dollar you paid them as if they were employees. The difference between the agency's estimate and the real number is usually the whole case, and it comes down to records and how they are presented.
Answer what was asked
Owners want to be helpful, and in an audit being helpful often means sending everything and opening new questions. A good response answers the questions actually asked, in writing, with support. Nothing more, nothing less.
Deadlines are real
Every notice carries a response date. Miss it and the proposed amount can become final, your options narrow, and collections can start. A letter that could have been answered with three documents turns into a lien. The first thing we do with any notice is calendar the deadline.
Payment plans are often simpler than people think
If a balance is legitimately owed, the question becomes how to pay it without sinking the business. The IRS and the Franchise Tax Board both offer installment plans, and many can be requested online once you know the right numbers. One of the reviews on this site is from a client who came to us worried about an IRS debt and left with a plan.
Pricing
Reviewing a notice and preparing a response is quoted once we see the letter. Audit preparation projects are quoted after we have seen the letter and the state of the records, and you have the number before we start. If the books for the year in question need to be rebuilt, that is quoted separately as catch-up bookkeeping.
Before the next letter
The best defense is a set of books that were kept properly in the first place. Clients on our monthly bookkeeping service have reconciled records, documented sales tax, and payroll reports from their processor reconciled and ready to go, which is why their audits tend to be short. If you have a notice in hand right now, call the office today.
Questions about audit and irs letter help in San Jose
I got a letter from the IRS. What should I do first?
Do not ignore it and do not call the number on the letter before you understand what it is asking. Bring it to us or email a photo of it. Most letters are a notice about a specific item or a balance, not a full audit, and many are resolved with one written response. We tell you which kind you have and what the deadline is.
Can you talk to the IRS for me?
It depends on the case. Only enrolled agents, CPAs and attorneys can represent any taxpayer on any IRS matter. As a registered tax preparer, Ray helps you understand the letter, gathers the records and prepares the written response. If your case needs someone with full IRS representation rights, such as an appeal or a collection case, we tell you up front and help you get your records ready for that professional.
What is a workers' comp audit and why did I get one?
Workers' compensation premiums are based on estimated payroll. At the end of the policy year the insurer audits actual payroll and subcontractor payments to true up the premium. If the records are unclear, the auditor assumes the worst, and contractors in particular get hit with big additional premiums. We prepare the payroll summary, certificates of insurance and classification detail so the audit reflects what actually happened.
What happens in a California sales tax audit?
The CDTFA compares your reported sales to bank deposits, purchase records and sometimes a markup test on what you bought versus what you sold. Restaurants, retail, auto repair and anyone with cash sales are common targets. We reconcile reported sales to the books and bank, document exempt sales, and prepare the records the auditor asks for so you are not assessed on estimates.
I owe more than I can pay. What are my options?
The IRS and the Franchise Tax Board both offer payment plans, and many people can set one up themselves once they know the numbers. We work out what is owed, what monthly amount is realistic, and help you prepare the request. If your situation needs penalty relief, an offer in compromise or a collection hearing, we point you to an enrolled agent, CPA or tax attorney who handles those.
How much does this cost?
It depends on the letter and how much work the records need. Reviewing a notice and preparing a response is quoted once we see the letter. Larger projects, like getting a year of records ready for a sales tax or workers' comp audit, are quoted after we see the letter and the records. We give you the number before we start.
Ready to get your books and taxes in order?
Call the office, send an email, or request a free quote online. Ray answers the phone himself and returns messages the same business day.