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Guiding You Through The Legal Process

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Steps to take on receiving an audit letter

On Behalf of | Jun 23, 2016 | Tax Audits

Some Georgia residents may be concerned about the possibility of receiving an audit letter from the IRS. However, very few people are audited, and even a notice of an audit is not necessarily something to worry about. The most important thing to do is open the letter as soon as possible and take action. There will probably be a response deadline, and complications and penalties can mount over time.

The first step is to determine why the audit is happening. The letter may be a request for something simple such as further documentation related to a deduction. There might be no particular reason for the audit at all. If someone else prepared the tax forms, it may be a good idea to notify them.

Sometimes, on reviewing an audit letter, it might be clear that the IRS is correct and that an honest mistake was made. One example might be a taxpayer who misunderstands a filing status classification. If this is the case, the person may simply want to pay. However, a taxpayer who believes the IRS is wrong might need to provide more evidence.

A person who is facing an IRS audit might want to have the assistance of experienced legal counsel. In some cases, an IRS audit may be complex and may involve in-person meetings, but even an audit by mail might be extensive and stressful. If a great deal of tax is owed, an attorney might be helpful in negotiating with the IRS. For example, it might be possible to make an offer in compromise. This occurs when it appears that a taxpayer will not be able to pay off a tax debt even with an installment agreement.