Do you have to undergo an IRS audit? Then there are many things that you will have to keep in mind. First, you need to understand that an auditor’s job is challenging as none likes the fact that they are being audited. So you have to make sure that they can do their jobs with patience and without any friction with the person being audited.
You will have to bear this thing in mind that the auditors are trained to keep a close eye on the things that are not right.
So if you try to show the information that is not asked for, then it way well goes against you as well. To this end, you should be polite and friendly and remain aware of the fact that the auditor is examining you and your returns as well.
Convince the auditor: The IRS auditor has to be convinced that you have reported all the income and you were entitled to deductions and exemptions that are questioned.
Delay if possible: If you can postpone the audit, it may work to your advantage. You should always ask for more time to get your records for some other reason.
Never host the IRS: You should keep IRS from holding an audit at your business place or your home. You can have a tax pro handle it. Field audits usually happen when you have a business income. Before hosting a field audit,
Take Time To Have Your Records In Order: If there are some receipts or any other documents, then you must take time to set your records in order.
Have realistic expectations: If you expect that you may come to clean out of an audit, then you should think again. There is no good in compromising on the amount of taxes that you have to pay. A good idea would negotiate the tax issue with the auditors.
Don’t act as a source of information: You should not give the auditor more information than what is needed. You should also learn to maintain silence and not talk too much during an audit. You must not be handing over any information that is related to past years. It is always better to not bring anything for audit that is not required. In this, you are not increasing suspicion in any way.
Know about audit: If you don’t have much idea about what is an audit, then you should research the legal issues by making use of free IRS publications and commercial tax guides. For those who have confusions about what a tax-audit is how you should be presenting documents to the auditor, it is always better to consult a tax pro before the audit.
Must know your rights: It is always better to go through IRS Publication 1 which explains the taxpayers’ bill of rights before the audit is conducted. Anytime during an audit, if you feel that audit is not going well, you should immediately ask for a recess and consult a tax pro. If the auditor is not treating you well, you can always speak to his manager. In case the subject of tax fraud props up, during an audit you must not try to handle it on your own.
Let time work for you: If an IRS audit starts, it must be completed within three years of the filing of tax return.
In The End
You must appeal the results if you are not in agreement with the results. You can appeal within the IRS or may choose to go with the court.