Client Information Bulletin
For tax years ended 12/31/07

In the past year, the United States Congress made some significant changes to the auditing and administration parts of the tax law. The main thrust of the legislation was to significantly increase the ability of the IRS to assess significant penalties to both you, the taxpayer, and us, the preparers of those returns. The increase of the risk of penalty comes into play in situations where an aggressive tax position on an issue is taken. Obviously, certain basic items are not in play here, but in our analysis, these new provisions can impact some taxpayers who do not believe they are aggressive in the way their returns have been prepared in the past.

While it has been our philosophy in the past to take positions that favor the taxpayer in all cases, we find it necessary to take certain additional measures and perhaps require more steps of you, our client, to ensure your position will have the maximum potential for success and the least exposure to penalty.

While each situation is unique, we want to enlighten all of our clients about this new environment and to be sure, between our joint efforts, we can handle the potential for audit and penalty. Your respective tax preparer will discuss this situation with you and help you understand how the new law applies to you and your tax situation.

Please be sure to ask questions to your satisfaction, as this is a team effort.

Thanks.

Robert N. Holmes, CPA/PFS
President & CEO