Well, after years of filing your tax returns with no issues, you finally received the dreaded audit notice and need to fight the IRS. So, what do you do now? Exactly how does an individual fight the IRS and win? This article will you the pointers needed to get you through the situation with less headaches and stress than you could ever have hoped.
- Become as organized as possible before the audit. Do you think you’re ready to fight the IRS? You need to make sure you are fully prepared before you set foot in that ring. You will receive a list of required documents in the mail with the audit notice. Separate your receipts by category and total them, and organize them in such a manner that you will be able to quickly provide the agent with the documents for any deductions that you have claimed. Many people believe that if they walk into an audit with a bag of unorganized receipts, that the IRS agent will simply throw up their hands and accept your word that you have all of your documentation. This is not so. They have the authority to disallow all of your deductions if you do not have all of your records organized and accessible.
- If you used any hard copy or online publications in the preparation of your return, make sure that you have copies to take to the audit. The IRS will not only want to know what you did, but why you did it. If you have a copy of your research, your behind will be covered. If you made any errors, and you can show the IRS agent your research, they may be more lenient with regard to penalties.
- During the audit, do not give more information than is requested. Answer the IRS agent’s questions fully, but do not offer additional facts or circumstances that are not pertinent. The fact is that if you open up other areas, it allows the IRS to probe even further into your personal affairs. Any of that information can be brought up in the future, if it serves their purpose.
- Consult a tax professional if necessary. If you have any complicated issues that affect your taxes, or are just much too nervous to handle it, consult a qualified accountant to attend the audit with you. Most accountants will be willing to do so, on a paid basis, regardless of whether they prepared your return. The IRS can compel you to speak to them and can require that you verify your deductions. However, they cannot force you to face an audit alone. If you have to fight the IRS, it is great if someone “has your back”, so to speak.
- Remain calm and know your rights. This is probably the most important step in preparation to fight the IRS. The agents are trained to try to throw you off-guard, by using sneaky practices and scare tactics. If you know your rights, and speak to them in a calm and professional manner, they will realize that their tactics are not effective with you.
The above points were obtained from a former IRS agent, who admits that the simple items listed above will keep you out of trouble. It is true that you can fight the IRS and emerge victorious, if you make sure to prepare in advance. Just remain calm, and remember that there is no reason to be scared of the IRS. Unless you cheat on your taxes, that is.