IRS Tax Audits

The Internal Revenue Service has increased the number of tax returns that are selected for audit. However annually only about one percent of Americans are audited.

Your chances of being audited are small, but not zero, as you may have just found out. What should you do if, despite your best efforts, you receive notification that your tax return will be audited? Don’t panic. Take a few deep breaths, try to realize that it’s not the end of the world. When most people receive that letter in the mail that states that they are getting audited by the IRS, they get nervous and concerned and horror stories flash through their head. No one ever wants to go through an audit, not even the most meticulous, honest taxpayer.

The audit may have been truly random, and not because of a mistake on your return, or the “mistake” may be a simple misunderstanding or mis-categorization of some type. If you have filed or believe that you have filed your tax returns correctly, then you have nothing to worry about. Just because you get selected for an IRS audit does not mean that you have done anything wrong. An audit by the Internal Revenue Service is nothing more than an examination of a taxpayer’s tax returns to determine if reported information is correct. Will it cost you money? Perhaps. Is it the end of the world, no, it’s not regardless of how well your taxes were documented.

Even if you receive notice of an audit then you have the protection of the Taxpayer’s Bill of Rights which protects you against unfair treatment by Internal Revenue Service auditors.

The best first step to take when contacted by an IRS auditor is tell them you to seek legal counsel before going any further in answering any of his or her questions or providing any documentation to him or her. Seeking counsel, does not and can not imply guilt of any kind. Even if you have nothing to hide you are entitled to have a tax attorney working with you, the auditor know that and should not imply guilt into your request. Do not share any information with the auditor because no matter how nice the auditor may be, he or she is there to do their job. And that job involves finding inaccuracies in your information.

Do not make the common mistake and talk to the IRS first and then come see a tax lawyer or CPA. Auditors like to make unannounced drop-by meetings at your place of business or personal residence. You are fully with in your right to ask that the meeting be rescheduled to another place and time. You can request any meeting with the IRS to be at a neutral location. Just remember, the IRS auditor is just doing his or her job, and you must take every precaution to protect yourself.

If you are being audited by the Internal Revenue Service and you want to protect your rights and be treated fairly, call the Massachusetts Tax Attorneys at Mooney McGinn LLP at free at 617-245-8080 for a consultation.

Here is a list of the tax services Tax Lawyers Mooney McGinn LLP provides and the federal tax issues we resolves everyday for our clients:

• Resolution of Tax Levies
• Stopping Garnishments
• Tax Lien Releases
• Tax Litigation
• IRS Tax Audits
• IRS Tax Appeals
• Bankruptcy Litigation involving Tax
• Reduction or Elimination of Interest
• Business Tax Planning
• Individual Tax Planning
• Personal Income Tax Return Preparation
• Business Income Tax Return Preparation
• Estate Planning – Trusts
• Tax Planning
• Tax Consulting
• Tax Collection Counseling
• Abatement of Penalties
• Offers in Compromise
• IRS Payment Plans
• Installment Agreements
• Payroll Taxes & Independent Contractor
• Innocent Spouse Relief
• Statute of Limitation Issues
• Business Entity Planning – Business Formation