IRS Tax Audit – Don’t Get Panic

Whenever you receive mail from IRS stating that you’re going to have a tax audit, like most of the people, you also experience sense of panic as well a fear. Isn’t it? However, IRS is not accusing you of anything; they just need answers to the questions that are not clear. Your panic result might lead to filing a notice of deficiency against you. And if this thing happens, your bank account or wages will be garnished by the IRS.

First thing you can do after receiving the mail from IRS is to read the letter and call them back to inform that you’ll be hiring a tax professional who will assist them with audit procedure. It will help you in buying some additional time. And while calling IRS don’t forget to take the badge number and the name of the agent. Also, make a note of the date and time you’ve called so that you can prove that did call IRS after receiving the letter.

You can also check the reason of auditing your tax return while calling IRS. Many a times notice sent by the IRS will have the reason or the information they are exactly looking for. You should gather all your original documents at the earliest. Most of the people start looking for original paperwork just a day or two before their meeting with IRS. However, gathering original documents and important paperwork such IRS debt relief form is a time consuming activity. You’d need to make sure that you don’t miss anything.

Organizing your records before audit is very important. If you represent just a bunch of receipt, be ready for a notice of deficiency because IRS agent will neither sort out the relevant slip nor organize your records. It may lead to the auditing of past years as well. While audit, do not give any information on your own. Just answer what agent is asking. If you’re giving any information unnecessarily, it might give a chance to the agent to ask something for which you’re not ready. It could be harmful for your audit.

In case, a receipt is missing or check stub; inform IRS beforehand that you’re working out this with store or the bank to get another copy of the receipt for the item. If you’re not getting duplicate receipt, check with IRS, if a letter stating that you did buy the item will work or not. If IRS gives permission, get in touch with bank or store to get the needful papers. Always try being as courteous and polite as you can. Because IRS agent is an expert and if you try to act smart in front of him/her, a note will be file that the audit is not clear.

Usually IRS meeting are quite difficult because you’d need to answer several questions. You will get only one meeting to pass the IRS audit so use it like anything. It is worth to hire tax professional to face IRS meeting however, make sure that the professional is well qualified.