When it comes to audits, there are some things the IRS may not tell you about, besides the policies and rules it insists you should be aware of. Therefore, if you are audited by the IRS, it is very important to have all the knowledge at your fingertips so that you land on the winning side.
Do you know why you could land yourself an audit?
This is the very first step towards avoiding an audit in the first place; knowing what could trigger one. Audit triggers include things like abnormal and suspicious deductions, extreme business losses every year, and third party referrals. The IRS will closely go through your returns to make sure that the deductions you have claimed are in sync with your income.
Make sure that your expenses are sensible and can be justified before you go ahead and file your tax return. In addition to that, never make the mistake of not reporting all your earnings. The IRS has an Automated Under-Reporter Program, which is used to catch culprits who don’t report all their income. If an error concerning your earnings is detected, you will definitely receive an IRS audit notice in your mailbox.
File for an Appeal
It is a fact that appeals are a practical option when it comes to solving problems developed between you and the IRS. Due to the fact that some examiners are in a hurry to complete the audit, they might miss some vital areas related to your tax audit. However, filing an appeal could get you a more positive result.
Are You Aware of Your Rights?
If you have received an audit notice, do not be scared because you have the right to defend yourself. There are many ways in which you can validate your tax return. Besides that, the IRS will let you re-submit your financial documents and also agree to take an oral testimony in some cases.
You also have the right to hire a tax preparer or professional if you do not want to deal with the IRS directly. It is also advisable to do so because these tax professionals will help you go through this frustrating process smoothly and more often than not, the results get will be in your favor.
IRS audits can be very frustrating, and more so if you do not know the detailed technicalities involved. Before you go through an audit, ensure that you know how the process works and most importantly, your rights.