What is an IRS Audit?
An IRS audit is a thorough examination of your tax account and financial information to ensure that figures are reported correctly and that you’re adhering to tax laws. As tax returns are filed they are compared to the average figures for other accounts in this category.
If your figures seem to be elevated, or show anomalies, your return is put into a pool of other returns and randomly picked for more in-depth review by an experienced auditor. After a review, your return may be accepted and filed away, or the return is forwarded to an examining group for further analysis.
Once any of these four types of audits are completed, the IRS will mail you an examination report that will detail the findings of the audit and any changes that are to be made to your returns and with regard to your tax liability. At this point, you have 30 days to approve or disapprove of the finds. If you agree with the audit findings and approve, you may need to take action to fulfill the adjustments to your taxes, such as paying additional tax penalties. If you disapprove of the findings, then your attorney can assist you in taking action such as filing an appeal.
Taxpayers should not fear the IRS audit process, no matter which type of audit is being conducted. With proper representation and preparation, we can help ensure that your audit does not become a tax nightmare. If you have received notice that you are going to be audited by the IRS, please contact us immediately.