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Audits/Problem Resolution

Many taxpayers are relieved when they've gotten their refund check, because they assume it means the IRS has checked over their return, everything's okay, and therefore they won't be audited. This is totally wrong. While the IRS now withholds portions of refunds due to the discovery of obviously erroneous deductions, the issuance of a refund has no bearing on whether you will be audited.

If you get a notice from the IRS or other taxing agency that you are being audited you should be aware that you have certain rights. IRS Publication 1 states the following:

You may either represent yourself or, with proper written authorization, have someone else represent you in your place. Your representative must be a person allowed to practice before the IRS, such as an attorney, certified public accountant, or enrolled agent. If you are in an interview and ask to consult such a person, then we must stop and reschedule the interview in most cases.

There are three types of audits:

Correspondence Audit

The IRS conducts hundreds of thousand of IRS tax audits as correspondence IRS tax audits. The correspondence audit is the least threatening IRS tax audit for the tax payer and the IRS audit in which the tax payer has the greatest chance of winning.

Field Audit

The second type of audit is a field audit. This type of audit is usually conducted for businesses and is pretty unlikely for individuals. In this audit, the IRS will send a group of auditors to the business to examine their books and other documentation. Basically, they want to ensure that they are not cooking the books.

In Office Audit

The last type of audit is an in-office visit. This audit will require individuals or businesses to take their tax documentation to an IRS audit to substantiate their tax return information. This can be to prove a deduction or business expenses. These audits are typically more difficult and the burden of proof lies on YOU to prove your tax information.

How can I help you if you are being audited?

I can examine your tax return for the year being audited to determine your risk. I will tell you how to manage that risk and how to proceed with the preparation you will need to respond to the audit. This is the best route for those of you who would feel comfortable dealing directly with the IRS.

If dealing with the IRS scares you to death, then I can handle all of the preparation and face to face dealings with the IRS. During this process you will be kept up to date on all meetings and conversations with Uncle Sam.