Hey David Makris, EPA here. I want to tell you about an experience I had with a small nonprofit. This nonprofit really only had to file a 990 in, but they made an error in their calculation of their gross receipts. They ended up filing a 990-ez but forgot to file the Schedule A. So, the IRS made a demand for the Schedule A, stating that their return was incomplete. The organization did the best they could to prepare the Schedule A and faxed it to the IRS. However, the IRS promptly responded saying, "Hey, we never got it". They then sent a fairly hefty penalty. That's when the organization brought me in. What I did was get the numbers from the client. It ended up being a big discussion. I looked more closely at their gross receipts and determined that they made some errors in counting various sources of income. Bottom line, when I prepared the Schedule A, the numbers were significantly different from what appeared on the original return on page one. I felt that filing a Schedule A with numbers that didn't match the return would not be a good idea. So, I also prepared an amended return and wrote a reasonable cause abatement request letter. I sent all of that in with explanations of exactly what I was doing. A couple of weeks later, the client received another notice, stating that they still hadn't received the requested information. The IRS threatened to levy their assets if they didn't comply. I called the IRS, provided proof of everything I sent, and they were very nice and explained what happened. They saw the amended return and focused on that, considering it a duplicate return. They ignored the fact that it was amended and just trashed it. They completely...
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