Finding out that you are being audited by the Internal Revenue Services is a frightening experience. Even if you think you've done everything correctly, tax laws are extremely complicated. It's easy to make a mistake unknowingly. However, the IRS is not infallible as we have seen in recent events. Sometimes auditors make mistakes too.
It came to light last week that revenue bonds of the Bronx Parking Development Co. are being audited by the IRS. The company manages the parking garages at Yankee Stadium in New York City. The IRS is working to review more than $237 million of debt that was used to pay for the stadium's parking structures. The debt is tax-exempt.
The parking garages have struggled financially as fewer baseball fans park at the stadium. Public transportation has seemingly become the preferred means of transportation to the ball park. Although the IRS is not allowed to comment on ongoing cases, a spokesperson said the review was to ensure compliance with the law.
While this situation is not happening in California, there is no doubt that some California businesses could be subjected to a tax audit. For those who do end up being audited, it is important to remember that you still have options if an auditor finds that you owe taxes. While it often seems like whatever the IRS says goes, the fact of the matter is that auditors are not always correct in their findings. If you have been told that you owe money to the IRS, it may be a good idea to speak to an attorney about appealing the findings.
Source: Bloomberg, "Yankee Stadium Parking Bonds Get IRS Audit Following Default," Michelle Kaske, July 17, 2013