Disagreement between examiners and taxpayers

According to a recent General Accounting Office (GAO) report, the following areas are the most frequent issues generating disagreement between examiners and taxpayers --

  1. Inadequate documentation;
  2. Unreasonable (excessive) compensation;
  3. Not a trade or business (hobby loss);
  4. Personal, non-deductible expenses;
  5. Deductions claimed for capital expenditures;
  6. Claiming deductions exceeding statutory limits, deducting other taxpayers or other entities' expenses, or non-deductible expenses.