Are you being audited by the IRS or perhaps you’re simply in a situation where you fear an audit is possible or likely? If you’re facing an IRS audit, you know the situation is potentially very serious. The best treatment, as always, is prevention. Get help from a tax expert. There are certain measures that can be helpful with mitigating the chances of an audit. More importantly, they may ensure that if you are not audited. If you are, we can help avoid unnecessary complications. Naturally, some people are more likely to be audited than others. For instance, sole proprietors who report more than $100,000 on their 1040 have a much higher chance of being audited than an employee reporting the same amount on their W-2, according to expertbeacon.com.
Entrepreneur.com describes some of the criteria the federal government uses when determining who to audit.
“The IRS chooses tax returns to audit through computerized screening. Additionally random sampling or document matching may select you. It’s not possible to predict when a taxpayer’s number will come up.”
Therefore, if you’re not already being audited, there isn’t necessarily a reason to panic. Regardless, the best defense is preparation. Consult with a professional team of tax experts. Business and Financial Solutions is an excellent choice. We specialize in helping clients resolve tax issues with the IRS. That includes audits as well as helping impending audits have the best outcome possible. Business and Financial Solutions can help guide you at significantly less the cost of a tax attorney. But still, we come equipped with detailed tax knowledge and expertise.
If you are facing an audit our team is be your best option. Schedule an appointment with one of our enrolled agents. Foxbusiness.com describes the enrolled agent role as:
“EA’s only tend to focus on preparing taxes, and many specialize in tax resolution. In addition to an IRS-administered testing and application process, enrolled agents must complete at least 72 hours of continuing education every three years.”
An enrolled agent has specialized tax knowledge that other professionals may not emphasize to the same degree. Strangely, EAs are some of the least understood yet most essential among tax and financial professionals largely.
The tax code is complicated and constantly changing…
The knowledge base that enrolled agents, CPAs, and other tax experts have overlaps greatly but not completely. This means that you should work with a team comprised of a variety of certified tax professionals. Thus, offering you the widest breadth of pertinent information. Regardless of the firm you use for the audit, there are a few things you’ll want to get done immediately…
First, prepare your documentation. This means gather up (and procure when necessary) all documents that are being requested by the IRS as well as any documents that you’ve been advised to prepare by your consulting firm (such as BFS) or tax attorney where applicable. However, don’t bring more documentation than you need. You don’t get extra-credit for proving how many hard copy items you can squeeze into one room. It’s about having everything that is relevant and useful handy.
During the whole ordeal, make sure to cooperate with the auditor. If you treat them like your enemy, they are more likely to act the part. They’re going to find out what they want to know eventually. So it behooves you if you’re the one who helps them get there. And the less hassle or grumbling the better.
As you go through the audit, rely on your tax professional to ensure that the auditor is correct. The auditors are quite human and make mistakes. And the last thing you want is a mistake to happen that ends up costing you. Use the expertise of firms like BFS to make sure that you’re protected against negligence or overreach. You need someone in your corner who can point to overlooked errors and deductions in your favor. You need someone who can advocate for you.