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IRS Agents Trained on QuickBooks

Here's the info:

The IRS has now begun accepting taxpayer records in electronic format. Overall, this should be helpful, since providing the necessary documents in paper form is often cumbersome. To faciliate use of the e-format the IRS has trained about 1,100 agents in QuickBooks, though they state in a news release, the Service does not endorse any 3rd party product.

Be careful though, I would not advocate simply sending your current working file. For instance, doing so would likely provide several years worth of data to the IRS...not a good idea. Also in your file are names, addresses and other sensitive data that does not need to go. Before sending a file you should have your CPA review the file. You should scrub any non-accounting data that does not affect your tax return. Perhaps a good approach is to copy the file and remove the unnecessary data to prepare that file for submission. Maybe the best approach is an export of a report with the revenue and expense data requested. Possibly this is all the IRS agent will ask for.

The IRS believes the e-format will not only reduce the paperwork burden but also will provide a complete set of records, decreasing requests for information and increase the agent's efficiency. The Service is relying on tax law for its authority to request such electronic data. It's unclear at this point how hard the IRS will push for the electronic format...time will tell.

Maybe now is the time to begin starting a new file annually and as with anything tax related, let your CPA help.