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GAO pushes for business matching program.

In the past, the General Accounting Office urged the IRS to start a corporate matching program where items reported by banks and other entities making payments to corporations would be matched against corporate income tax returns. The IRS could then catch corporations that underreport or neglect to report items shown on information returns. (This would parallel the matching program for interest and dividends and certain other payments that is now used for individuals.)

The GAO has urged Congress

* To pass a law requiring payers to report payments made to corporations.

* To provide the IRS with the funds necessary to implement a corporate matching program.

Such reporting rules would impose added costs not only on payers but also on corporate payees: Corporations would have to reconcile payments to information returns. For example, corporations on a noncalendar year would have to reconcile to reporting done on a calendar-year basis.
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Author:Wagenbrenner, Anne
Publication:Journal of Accountancy
Date:Dec 1, 1991
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