IRS audit

What to do when you get a IRS Audit?

When a taxpayer receives a letter from the IRS about auditing his or her tax return, the taxpayer usually panics and worries what to do about the pending IRS audit. The chance of an IRS audit is slim but it does happen and when you get a letter from the IRS about an IRS audit, you should keep calm, review what to do when you get an IRS audit and start preparing for the IRS audit. Below are some ways the IRS can go about its audit.

IRS audit by mail

Most of the time, the IRS will inquire about inconsistencies via mail. This is the most common and easiest form of IRS audit. The IRS will send a letter with either:

  • a request for more information or
  • a reason why it believes a change to the taxpayer's return may be necessary.

What to do when I get a letter from the IRS?

The taxpayer can respond to the IRS by mail or can request a personal interview with an IRS auditor or examiner. If the taxpayer mails the IRS necessary information or explanations and the IRS does not agree, there might be a series of correspondences for this type of IRS audit. IRS audit by mail can end nicely or it can end with the taxpayer going to the Taxpayer Advocate office.

IRS audit by interview

Sometimes the IRS will notify the taxpayer that it needs to perform an IRS audit through a personal interview or the taxpayer can request an interview with the IRS. If the IRS auditor or examiner proposes a change in the taxpayer's return that the taxpayer does not agree, he or she can discuss the matter with the IRS examiner's supervisor.

IRS audit by repeat IRS audits

If the IRS has already audited the taxpayer's tax return in either of the previous 2 years for the same item and found there to be no proposed change to the tax liability, then the taxpayer can contact the IRS office so that the IRS can determine if the IRS audit should be discontinued.

The taxpayer has to bear in mind that most of the time the IRS audits tax returns to get more information and it is not always going to require more money from the taxpayer. If you get an IRS audit letter, be calm and try to provide the IRS with what it needs. The IRS will undoubtedly need a lot of information from the taxpayer in the most convenient way. However, sometimes, the taxpayer will not have all the evidence from years ago. In such cases, the IRS will accept other records for the IRS audit.

There are also many IRS audit tax assistance places that will help you with any IRS audit. Many tax preparation offices now offer audit assistance services or audit protect services. If you happen to get a letter about an IRS audit from the IRS, these offices will send a representative to go to the IRS audit with you or meet with the IRS on your behalf. Sometimes you never have to meet with the IRS at all. However, meeting with the IRS is not all that bad and with proper preparation, you might even find tax credits and deductions you missed when filing your previous tax returns.