The IRS is the federal government's tax-collecting agency. It collects taxes, audits taxpayers, and enforces tax laws. However, no one likes to get audited. The thought of an IRS audit is frightening. With just 5 simple strategies, you can conquer your fear and be prepared when, not if, the dreaded letter arrives. Here are 5 strategies to make the process go as smoothly for you as possible.
1. Staff Your Audit With Experienced Attorneys
Hiring a tax attorney or a certified public accountant in USA is a great opportunity to get years of experience dealing with the IRS and its agents and advise on potential criminal charges that may arise from an audit. It is important to note that hiring an attorney costs less than getting hit with high penalties or criminal charges. Knowing that someone familiar with these situations has been helping guide them through it provides peace of mind.
2. Don't Appear Incompetent Or Indifferent To The Questions
The first thing you need to remember is that the agent conducting your audit wants to help you get through it as quickly and easily as possible — just like you do! They work with taxpayers daily and know how intimidating an audit can be. So don't be afraid to ask questions or ask for clarification if something isn't clear. If they ask about something in your return that doesn't apply to you or seems out of place, don't be afraid to say so!
3. Listen Carefully To The IRS Auditor
If you need to take control of your audit then you must listen carefully to the IRS auditor. They are not there to help you and don't want a fair resolution. The auditor's goal is to find a mistake or inconsistency in your tax return so that they can ask for more money from you. This means that they will ask questions–lots of them! And if they don't get answers that fit their theory about what happened, then they'll keep asking until either:
- You give up because it's too much work (and stress) trying to explain yourself; or
- You make one small slip-up that can be used against you later when arguing against their assessment letter after the audit has ended (which may take months).
4. Have All Your Documents Ready
When facing an IRS audit, having all your documentation ready is key! If you are audited for a tax year, ensure you have all of your documents from that year with you at the time of the audit. If questioned about something missing from your documentation, make sure you bring it up then and there so that no accusations are leveled against you later on.
- Do Not Make Excuses For Your Tax Return Errors
No matter what happened during tax season — whether it was a human error on behalf of someone else in your office or some other issue — do not make excuses for any errors found on your tax return during an audit. The auditor will already be looking for reasons to find mistakes, so don't give them any ammunition by saying things like “I don't know how this happened” or “It wasn't me.”
Prepare for an IRS Audit
The IRS can be scary, but it doesn't have to be. By following these strategies and being prepared for your audit, you can ensure it goes as smoothly as possible. For more accuracy, you can even use the services of a tax planning consultant to help you make a financially flawless plan in terms of tax and accounting. Hence, you never have to worry about IRS auditing again.
Among many firms available today, top-of-the-line service provider Nidhi Jain is a certified tax planner that can provide unparalleled tax planning services in Bay Area ranging from business tax services to individual tax filing. But most importantly, the firm can provide excellent representation in case of an audit by the IRS.
