Received an Audit Letter? Don’t Panic.
For many individuals who reside in the Washington, DC, metro area, completing their taxes one of the most stressful times of the year. While many likely heaved a sigh of relief once the documents were complete, the matter may not be over for some. According to president of Surevest Wealth Management, about 1 percent of the population will receive an audit letter from the Internal Revenue Service. The stress level of that 1 percent likely rises the moment they open that letter.
Readers who are starting to get anxious about receiving an audit letter would likely be interested in learning additional information on the topic. The first thing to know is that in most cases a computer selects who will be audited based on what it deems to be anomalies in a return. Also, the more money one makes the greater the chance that an audit will occur. For example, someone whose income is more than $1 million sees their chance of being audited increase to 10.85 percent.
So what should you do if you find a letter from the IRS in your mail box? The first thing is try not to panic. It is possible that the agency is just looking for additional information about your return and once it receives it, will be satisfied. The next thing is to try to figure out what caused the IRS to flag the return. After figuring that out it is important to gather the documentation that supports what is on your return. It is also a good idea to address the matter in a timely manner and be polite. Many people find that it is best to work with a tax attorney and have them help with the matter.
There are multiple reasons why it is a good idea to seek the assistance of a tax lawyer when one is facing an audit. . That individual can help with steps listed above and even attend the audit appointment on behalf of the person being audited. As they create a buffer of sorts, this is particularly helpful to taxpayers who are prone to losing their temper. In addition, they can help manage the information the IRS seeks to make sure they are not overstepping their boundaries.
Regardless of how one would like to respond to an audit, consulting a tax attorney is generally the best place to start. With that individual on your side, it will likely run more smoothly.
Source:FOX Business, “What to Do if Your Receive an Audit Letter from IRS,” Donna Fuscaldo, May 9, 2014