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Originaly question stated: Person worked as a self-employed independent contractor (receiving Form 1099-MISC non-employee compensation) in 2001, 2003, 2004, and 2009, but not in 2005-2008. Person no longer remembers whether 2001, 2003, and 2004 returns used cash or accrual method on Schedule C. I considered using Form 4506-T to get a transcript or record of account, but Form 4506-T says to that it is too late now to request a 2001, 2003, or 2004 transcript or record. I also considered just saying that the original business ended in 2004 and this is a new business that started in 2009, but that does not work because of issues with the retirement plan. Taxes will be the same regardless of which box is checked, but the same box needs to be checked as previously, because IRS approval to change methods has not been requested. How do I determine which box was checked on the 2001, 2003, and 2004 returns? This has since been determined to be incorrect. The person also filed a Schedule C-EZ (cash method) in 2005, but forgot about it. |
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Your client (and you if you have a power of attorney) can get a transcript faxed same day. Just call the IRS. It shouldn't be a problem to get the old return. |
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"self-employed independent contractor" sounds like a cash basis taxpayer. I don't see a whole lot of reason to accrue expenses or income under these circumstances. |
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I would just put cash. IRS does not keep track of things that old. |
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I asked this question originally, but later found the answer myself. After further investigation, the current answer is the following: The person also filed a Schedule C-EZ for 2005 and forgot about it. Since Schedule C-EZ can be filed only using the cash method, this shows conclusively that the last time that the person filed either Schedule C or Schedule C-EZ, the person used the cash method, not the accural method. |
After further investigation, the current answer is the following:
The person also filed a Schedule C-EZ for 2005 and forgot about it. Since Schedule C-EZ can be filed only using the cash method, this shows conclusively that the last time that the person filed either Schedule C or Schedule C-EZ, the person used the cash method, not the accural method.