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What happens during an audit?

On Behalf of | Sep 2, 2022 | Tax Controversies |

No one wants to pay more taxes than required. An IRS audit notice may prove stressful.

While you believe you have carefully reported necessary information, you may start to second guess everything. To minimize the stress, it may help to understand the reasons behind the process.

Why does the IRS audit people?

An audit means that the IRS wants to take a closer look at your tax returns. It requires you to produce evidence of the items you claimed on your return, including charitable contributions and business expenses. Anything you wrote off or anywhere you claim income went that kept it away from tax payments, the IRS expects you to justify.

What happens during an audit?

The IRS may request you send them items in the mail or go to a local office in New York for your audit. The IRS will send you a detailed letter stating the items you need. The reviewer breaks down every element of your return and compares it to the evidence provided. Depending on the extent of the investigation, you may not know the results for several weeks.

What is the result of an audit?

Once your auditor finishes, you will receive a statement setting out the conclusion. In this document, the IRS representative will give you the final breakdown of how much you owe versus what you paid. If you owe the IRS more money, you must remit payment within the time allowed or set up a plan. You may disagree with the IRS findings and request mediation.

The IRS has a limited timeframe within which to work for auditing returns. There is also a process that allows you to have representation before them to ensure everything goes according to the law.