IRS Audit Representation
An IRS tax audit can be caused by many things including math errors, using round numbers, Schedule C losses being too abundant, and even claiming an abnormal amount of charitable donations. If you have been selected for an IRS audit you might need to hire a Protaxion Tax Consultant for help.
Remember, it is crucial that you inquire about representation before communicating with the IRS!
Why am I being Audited?
The IRS conducts audits to ensure that taxes are being reported and calculated accurately. The IRS wants to examine your financial information and see if it matches with you tax returns. There are four types of IRS audits and the reasons vary from being randomly chosen to the IRS having strong suspicion of taxpayer fraud.
Types of IRS Audits
When the IRS finds an irregularity in a taxpayers return it will select the tax return for an audit. There are several types of audits that the IRS can order and it is helpful to understand the differences.
IRS Audit by Mail (Correspondence Audit)
Normally, the IRS processes your tax returns without questioning the figures and calculations. Occasionally, the IRS selects a tax return for further inspection to make sure that the taxpayer has accurately reported their credits, expenses, and income.
An audit is also known as an examination. A tax return examination does not mean that the taxpayer has necessarily done something illegal or wrong but often the extra scrutiny finds an error or more on a tax return. The IRS will propose changes to the tax return after it completes the examination and can impact how much is owed in taxes and change the amount of any refund previously calculated.
Random IRS Tax Audit
A random IRS tax audit does not mean that the IRS is investigating anything in particular related to your tax return. The examination process is still extensive and detailed and it is looking for any area on your return that might produce more owed taxes. Random audits are typically the most extensive type of examination because there is not a particular concern that alerted them to a potential understatement or error on the tax return.
Office IRS Tax Audit
An office audit normally warrants hiring a Protaxion Tax Consultant to represent you. This type of examination means that the IRS has found particular irregularities or errors large enough in your tax return that it has formally invited you to an IRS office to perform the examination. And IRS Revenue Agent will conduct the audit and request additional documentation. It is important to understand your Taxpayer Rights before communicating with the IRS.
Field IRS Tax Audit
An IRS field audit is the most serious of the four types of IRS examinations. The IRS has chosen your tax return for audit because it has found grave problems. The IRS Revenue Agent assigned to your case will be asking for additional documentation and evidence working toward finding any issues with your tax return. The Revenue Agent is looking for something and that is why they are coming to you. They are searching for answers inside your business, observing your home environment, checking your business equipment, your cars, furnishings, appliances, and anything else of value to give their opinion if you are reporting all of your income. It is never advised to go into a field audit without experienced and professional representation.
Why You Should Have Professional Representation
You Have the Right to hire Protaxion
You as a taxpayer have a right to hire a professional to represent you when dealing with the IRS. Any time before or during an aIRS audit you can halt it and reschedule to continue with professional audit representation.
Protaxion Keeps the IRS Focused on the Audit
If you accidentally answer the IRS Revenue Agent’s questions incorrectly and this can result in additional examination and more tax problems. A Protaxion Tax Consultant will know how to answer the questions to minimize your exposure.
The Audit Will Take Place at Protaxion's Office
Having and IRS audit conducted at your home or office does not always give the best impression to clients and neighbors. Inviting the IRS into your home also increases your chances of something raising suspicions in the Revenue Agent’s eyes. Normally, Protaxion invites the IRS Revenue Agent to our office and handles the examination process there.
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Having a team of dedicated tax professionals on your side is a powerful position to be in when managing a tax matter with the IRS, and we look forward to helping to put you in a winning position to succeed.
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