An examiner may require the immediate production of records. Make sure your companyâs data storage and networking infrastructure is up to date. Prepare for unannounced compliance audit by obtaining a copy of an inspection checklist from a specific regulatory or governing agency. Compliance is a multifaceted and complex matter.
Federal taxable income is the adjusted gross income less the deduction for personal exemptions and itemized deductions, which include items such as home mortgage interest, property taxes and charitable donations. Taxable income is the figure used to determine the actual taxes due.
Once you have determined your gross income from all sources, you can then calculate your taxable income. Your taxable income differs from your gross income in that it counts allowable deductions, exemptions and other subtractions for which you may be eligible. This figure can be drastically smaller than your gross income depending on the number of deductions that you take or exemptions that you can apply.