If you learn that you are going to be subjected to a tax audit, anxiety and fear are likely to be your first reactions. However, with the proper preparation and competent tax audit representation, tax audits don’t have to be scary. Consult the information below to learn more about the tax audit process and determine whether you need to hire a tax professional for tax audit representation.
What Is A Tax Audit?
A tax audit occurs when the IRS has questions or concerns about one or more entries on your tax return or when your return is selected at random for review. The purpose of the tax audit is to analyze questionable entries on your return and make sure that they are accurate and documented properly.
The three primary types of audits that exist are: correspondence audits, field audits and line-by-line audits.
The most common type of IRS audit conducted is the correspondence audit. In this type of audit, the IRS typically has questions about one or more specific discrepancies on your tax return. You will be required to submit documentation that validates the entries on your return in order to resolve this type of audit. If the IRS determines that a mistake was made on your part, you may owe additional tax or penalties. Correspondence audits are completed by mail.
Field audits are usually more serious than correspondence audits. This type of audit will take place at your place of business, home or in a local IRS office. During the audit, you will meet face-to-face with a representative from the IRS who will ask specific questions about your tax return and review any supporting documentation you can provide.
Random audits are the final type of audit you may face. The subjects of these audits are chosen at random by the IRS for the purpose of quality control. However, if any problems are found during this process, including deductions or credits that aren’t properly documented, you may be penalized.
Do I Need Tax Audit Representation?
If you are facing a tax audit (tax examination), getting IRS examination representation help from a professional is highly recommended. An IRS audit professional can explain the tax audit in detail so that you understand all of the tax laws that pertain to your case. He or she can also help you prepare all of the documentation you need for the audit, and he or she can help you structure your responses to IRS questions so that no new issues are brought up during the meeting. The tax audit professional will handle all correspondence and go to any and all meetings on your behalf so that you don’t have to meet or talk with the IRS examiner yourself.
Without professional IRS tax exam representation, a tax examination almost always results in changes to your tax return, but having an experienced tax audit representative working with you can help to minimize the damage.
Hiring the Right Tax Audit Representation
Not every tax professional will be equally qualified to help you with your audit. Some tax professionals may be able to help you prepare a tax return, but they don’t have the training or experience necessary to aid you in preparing for a tax exam. For this reason, it is important to compare your options carefully before you choose a tax professional to represent you. Only an enrolled agent, CPA or attorney may represent you with a tax examination. As you consider different professionals, make sure that you ask the following questions:
- What training do you have with regard to tax audit representation?
- Do you have experience representing taxpayers in face-to-face audits?
- Are you willing to appear on my behalf during a field audit?
- What are your fees for audit representation?
Once you have selected a tax audit representative, your tax audit representative can help begin preparing for your audit. If you are completing the audit by correspondence, this will start by simply gathering the documentation your audit representation requests from you. However, if you have been selected for a face-to-face or line-by-line audit, the audit preparation will be more intensive. You may need to review the audit paperwork carefully, gather a variety of documents and meet with your tax audit representative to discuss your answers to the questions posed by the IRS.
Samaritan Tax Relief IRS Audit Representation
One of your most important rights as a taxpayer is your right to have a qualified tax resolution professional, such as an Enrolled Agent (EA), represent you with your IRS audit to ensure that your rights are protected.
When you hire Samaritan Tax Relief to assist you with your IRS exam, we will guide you through the process while advocating on your behalf and protecting your interests.
Samaritan Tax Relief is here to help you because when you’re dealing with the nightmare of a tax audit, the worst thing you can do is ignore it. The best decision is to take the necessary first step and obtain tax audit representation!
Click on the “Get Help” button at the top of the page to take that first step.