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When I sold my home all of my files were destroyed by water damage underneath a crawl space. When I went to move I discovered 40 boxes of water damaged and molded files. I had the files taken away and destroyed. Now fast forward a few years and low and behold, I am under audit and I do not have a copy of all of these receipts.

It took me a year to go back and find every person who was ever involved in remodeling my home going back 14 years. It has been a nightmare reconstructing 14 years of damaged files. However, I do not have every contractor name and a couple of important ones are now deceased. The State Franchise Tax Board does not care and are trying to stick me with a big tax bill. It is so unfair since I have plenty of before and after pictures to show them. Any ideas?
Real Estate
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William Keats
What is California asking you to substantiate? You may need to contact IRS and file IRS Form
4506-T, which will show what income was reported to them for whatever years you need. Statute of limitations is only 3 years. However, you seem to be talking about improvements made to the home.
If any permits were required for construction or modifications on the home, you might be able to acquire those from the county tax office or assessment office. The town supervisor should be able to give you some guidance.
Apparently the State is looking for more tax on the profit from the sale, if any. Who prepared your returns? Would your accountant have any documentation?
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