IRS Audit Representation
If your tax return was selected for IRS tax audit. You may or may not need the help of a CPA or tax attorney for IRS audit representation. It depends on the type of audit and whether there are issues with your IRS tax return.
WARNING!!! It is very important to talk to a CPA or Tax Attorney FIRST before you talk to the IRS if there are issues with your tax return.
Do You Need IRS Audit Representation?
The IRS is likely auditing your tax return because they believe there is an issue with your tax return. Review the different types of IRS tax audits to help you determine whether you need IRS audit representation.
1) By-Mail IRS Tax Audits: Generally, you will not need IRS audit representation for this type of audit. The IRS will ask you to provide proof for one or two things on your tax return. If you have clear proof, then you do not need IRS audit representation. For example, if you wrote-off $20,000 of mortgage interest, you can send the IRS a copy of Mortgage Interest Statement showing $20,000 of interest paid. However, if the issues are more complicated and/or you lack proof, then we recommend that you hire a professional.
2) Random IRS Tax Audits: You may or may not need IRS audit representation for this type of audit. The IRS did not select your tax return because of possible issues. The IRS randomly selected it. This type of IRS tax audit is comprehensive and the IRS will review everything on the tax return. A random IRS tax audit can be time-consuming depending on the complexity of your tax return. If you have documents to support everything reported on the tax return, then you do not need IRS audit representation. Consider hiring IRS audit representation if you are aware of issues with your tax return.
3) In-Office IRS Tax Audits: You should consider hiring IRS audit representation for this type of audit. Your tax return was selected because the IRS believes there is an issue with the tax return and they decided the issue was big enough to assign your case to a IRS Revenue Agent. The Revenue Agent will focus on the problem areas.
4) Field IRS Tax Audits: We highly recommend that you get proper IRS audit representation for this type of audit. Your tax return was selected because the IRS believes there are MAJOR issues with your tax return, and they have assigned your case to an experienced IRS Revenue Agent. The goal is to uncover all issues with your tax return. The IRS will expect to conduct the audit at your home and/or place of business. The IRS will review your business and home surroundings to determine if you reported all your income. The IRS will look at the business equipment, the cars you drive, home furnishings, kitchen appliances, TVs, and other items of value.
TOP 3 REASONS TO HIRE A CPA OR TAX ATTORNEY FOR IRS TAX AUDIT REPRESENTATION
1) It’s Your Right: It is your right to hire a professional to represent you. At any time before or during the IRS Tax Audit, you can stop the audit and reschedule the audit with a professional.
2) A Hired Professional Will Keep the IRS Tax Audit Focused: The IRS will ask you many questions about your return. You may accidentally answer the questions improperly. As a result, the IRS will increase the audit causing more problems for you. If you hire a professional, it is not expected that the professional will know the answer to all questions. The professional can say, “I do not know, let me discuss further with my client.” The professional will review the question with you and prepare a good response for the IRS. You will feel secure that the professional is guiding the audit.
3) The Audit Will Take Place at Professional’s Office: What will your office staff or customers think if the IRS is in your office? Would you feel comfortable with the IRS in your home? Most people do not want the IRS to come to their home and/or place of business. If you hire a professional, the IRS Tax Audit will be done at the professional’s place of business. Generally, your tax return was selected for IRS Tax Return because the IRS believes there is a problem with your return. Hiring a professional for IRS audit representation will be an important decision. A trusted professional will help you get through the IRS Tax Audit process.