Tax audits can be stressful, but with the right preparation, they should not be heavy. If you have been
selected for the audit, it is important to understand what to expect and how to handle the situation.
This guide will run through steps to take you before, during and after the audit. By the end, you will
have a clear understanding of how to protect yourself, avoid normal damage, and make sure you are
fully prepared for a smooth process.
Understand the tax audit process
A tax audit occurs when IRS reviews your financial records to ensure that the information you
mentioned on your tax return is accurate. The tax audit can be triggered for various reasons, including
discrepancies between your income and deduction or random selection. It is necessary to understand
what to expect during an audit and how to handle the process efficiently.
Audit Notice: What’s next?
Once you receive an audit notice, the time comes to take action. The IRS will usually send a letter to
explain why you were selected for the audit and which documents are required. Understanding the
scope of the audit is the first step to prepare yourself. Here’s how to handle it
Carefully review the IRS letter:
Notice will indicate the type of audit you are facing – whether it is a
correspondence audit (handled by mail), an office audit (in an IRS office), or a field audit (in your
home or business). Knowing this will help you determine the required steps.
Gather your documents:
IRS will request specific documents, such as income details, receipts, bank
records and any other relevant financial paperwork. Be sure to gather everything that the letter asks to
avoid delay in this process.
Consult a tax professional:
If you are not already, now is the time to reach the tax advisor or CPA.
They can guide you through the process, help you organize your documents, and represent you during
the audit if necessary.
What do you expect during audit
Knowing what can be expected can reduce anxiety. While each audit is different, there are some
common stages that apply to most cases:
Preliminary Meeting:
If you are facing an office or field audit, you will be asked to meet with the
IRS agent. Be sure to bring all the requested documents, get ready and ready for review.
Checking of documents:
IRS will review your tax returns and assistant documents completely. They
can ask for additional information or explanation on some objects.
Discussion of findings:
After reviewing your records, the IRS agent will discuss their conclusions
with you. If there are discrepancies, they can propose adjustment to your tax return.
Resolution:
The results of your audit will either change your tax liability, if you overfed then increase
the amount, or will increase in refunds. If the adjustment is made, you will receive a written notice
that you need to do, giving details of those changes and any action.
How to handle disagreement
If you disagree with IRS findings, you can appeal to the decision. This way:
Request the appeal:
If you disagree with audit results, you can formally request the appeal. This
includes the second review of your case by the IRS Appeal Officer
Look for professional assistance:
If you decide to appeal, it is highly recommended to seek
assistance from the tax lawyer or CPA. They can help you make a solid case and represent you during
the appeal process.
Consider the payment plans:
If you pay additional taxes and are unable to pay the entire amount, the
IRS offers the payment scheme. Work with your tax advisor to detect these options.
Master the Audit Process with Expert Guidance from CT Tax Services!
In CT tax services, we are experts to provide advice and audit preparations to individuals and
businesses. Our team of experienced professionals is dedicated to navigate the landscape by
complicating and helping you to help you fully prepared for any audit. With our guidance, you can
confidently handle the audit process and reduce any possible risk.
Frequently Asked Questions (FAQs)
1. How long does the audit process take?
The length of the audit process depends on the complexity of your case. A simple correspondence
audit may take only a few months, while more wide area audit may take longer.
2. If IRS gets mistakes in my tax return, will I face punishment?
If IRS finds mistakes, you may be subject to punishment and interest on the underpaid amount.
However, you may be able to avoid punishment if you can show that the mistake was unknowingly
and not due to negligence or fraud.
3. Can I represent myself during tax audit?
Yes, you can represent yourself, but it is appropriate to consult with tax professional, especially if you
are unfamiliar with the audit process. A professional can help ensure that you are fully prepared.
4. What if I do not respond to IRS audit?
Failing to respond to an audit can lead to significant punishment, which includes IRS that assesses the
tax given by you based on your own findings. In extreme cases, IRS can also initiate legal action.
5. How can I avoid tax audit?
When you cannot guarantee that you will not be audited, keeping an accurate record, filing your taxes
correctly, and avoiding red flags (such as inconsistent reporting or high cuts relative to income) may
reduce your chances of being selected.
Navigate Your Tax Audit with Confidence – Expert Help at Every Step!
Facing tax audit is not a challenging experience. With proper preparation, correct professional
guidance and understanding of the process, you can handle the audit with confidence. In CT tax
services, we are here to help you at every step from preparing your documents during the audit
process.
If you have received an audit notice or just want to prepare you, then contact the
experts for assistance today. We will guide you through the process and help
protect your financial interests.
