What to do if you owe state taxes because of an IRS aduit?

Answer 1

Pay them...most States and the Feds share that info. Answer 2: Once you have been through the entire Audit process, then you would pay your state taxes accordingly. Federal taxes are always sent in with state taxes. The IRS does not talk to the state, so you could be audited at a different time. In fact there are very formal arrangements to share info between governments. Including, as is being done in some States, the IRS actually entirely handling it for the State. A time, money saving and more efficent experiment that many are looking to adopt.....but it requires using a 'piggyback" rate and other rule modifications for the state. Link provided. The IRS Fed/State Program saves government resources by partnering with state government agencies to enhance voluntary compliance with tax laws. This includes facilitating the exchange of taxpayer data, leveraging resources, and providing assistance to taxpayers to improve compliance and communications. The IRS also assists state agencies by identifying and reporting information on emerging tax administration issues. This is accomplished through the IRS entering into agreements to share information with the state agencies. To ensure the privacy of all taxpayer data, the Disclosure program provides oversight and education to all employees and external partners to ensure the protection of taxpayer confidentiality rights regarding Fed/State exchanges. There are more than 900 joint efforts underway. Examples include the sharing of examination reports, abusive scheme data, and licensing verification. Through partnerships with state government agencies, the IRS is able to facilitate taxpayer efforts to meet their tax obligations, with a focus on customer service, integrity, and fairness to all.