Tax Planning

Tips For Being Audited By The IRS

Audited By The IRS

Audited By The IRS

If the IRS chooses you for an audit, you don’t really have a choice but to do what they ask.  Refusing to cooperate with the Internal Revenue Service can lead to jail time, and no one wants to sit in a cell.  

What you should truly turn your focus towards is minimizing the financial impact of the audit.  You also don’t want the IRS to feel the need to dig further into your personal finances, as it could drag your audit out for quite some time.  

Take a moment to read about some helpful tips that will help you handle your audit with grace, and rest assured the pain will be over soon.  

Prepare all of your financial records

When you are chosen for an audit, the IRS will typically explain to you a specific portion of your financial records it hopes to explore.  Prepare all the records you need to show the IRS where your money is coming from and going.  

If you don’t have all of the records requested, start working to replace them.  Don’t simply tell the IRS agent that you have lost them, as it only hurts you in the situation.  

Know your rights in the situation

Before the auditor gets to your door (figuratively speaking), you should brush up on your taxpayer rights.  Read through the information offered on the IRS website, and you’ll find lots of useful information.

If you find that your audit is turning in a southerly direction, you may want to hire a lawyer for help with your audit.  It’s not wise to tackle the accusations of tax fraud on your own.  

Always ask for more time

You always have the right to stall.  The right isn’t blatant, but there are a hundred and one different reasons you can ask for more time on your audit.  

Though it will drag the process out longer, time is a friend of those who are being audited.  If the IRS doesn’t find evidence of fraud within 36 months of the beginning of their investigation, they have to drop it.  

Don’t offer up information unless it is requested

It’s important that you only offer up information about your personal finances when the IRS asks for the information.  Don’t offer anything extra, as you could prompt your auditor to delve deeper into their investigation.

Don’t be rude to your auditor

Throughout the process, try not to forget that your auditor is also a human.  He/she has a life outside of the Internal Revenue Service, and they are only doing the job they have been charged to do.  Give them a break, and don’t give them attitude.  You’ll do well to make a comrade out of your IRS auditor.

Share: