Facing An IRS Business Audit? How To Save Your Business

Have you received an ominous letter from an Internal Revenue Service agent informing you of a forthcoming IRS business audit? In this case the IRS has found something they feel worth investigating and the IRS business audit can prove whether your has been involved in a felonious act, such as tax evasion, intentionally or by accident, against the IRS.

Receiving the note that you will be investigated is scary, but an order for an IRS business audit does not necessarily mean that you have done something wrong (although that is the case for a number of business owners).

It is a fact that IRS randomly selects businesses to audit through the use of an automated system for businesses that have an income tax deduction rate that is significantly lower or higher than the norm.

Additionally some expense deductions when added up signal red flags to the IRS that will have agents auditing your finances, combing through your records, and disrupting your life in short order. Complaints against you with regard to taxes will be subjected to an IRS audit as well, and unfortunately malicious competitors have been known to make false claims to disrupt the competition.

At any rate, you will be informed by the IRS who will get in touch with you in person. All business owners have the right to know why they are being investigated, and though not a fun process, handled correctly you can escape unscathed.

Different Types of IRS Audits

The IRS Correspondence Audit, as the name implies, is an audit in the form of a letter asking for copies of checks, receipts or any documents that can be used to authenticate specific deductions on your business tax return. These deduction documents will be sent to them for scrutiny. This will also be the basis of determining if they need further investigation regarding the matter.

The IRS Office Audit will order you or any person representing your company to bring in documents to their office to be examined relating to the recent tax filing in question.

The IRS Field Audit is what most business owners dread receiving. A phone call will be received from an IRS agent informing the owners that an on-site audit is on its way. A field audit will require a forum with the owners and tax representatives at their business location, access to their business records must be provided as well as any requested documents the agents intend to audit. The auditor will direct questions to the business seeking information may or may not be used against you. This is the reason why your business representative should be beside you at all the times during a field audit. Your professional tax consultant will be able to handle questions that are leading and intended to entrap the owners to make mistakes in answering.

The TCMP audit or the Taxpayer Compliance Measurement Program audit is a type of business IRS audit which aims to update the information used to perform the scoring. It is a very tedious and time-consuming task that can seem to be overwhelmingly irrational. You will be asked to provide checks, contracts, invoices, transaction details and any tangible data about a certain matter of your business that is being subjected to the audit.

If you are subjected to any of these kinds of audit, the important thing is to stay composed. Do not panic; try to think clearly and work with a proven IRS tax problem resolution consultant. Being informed that you will be audited is the opportune time to get organized and get the help you need.

How To Handle A Business Audit: Help IS Available

Handling The Audit By Yourself?

To begin, we do not recommend facing the might and efforts of the IRS alone.

Facing an business audit by the IRS will require a great deal of your time, and experience and expertise can save you thousands in penalties, not to mention the serious legal consequences of making mistakes.

That being said, if you are going to handle the audit without any help from an expert it is important for you to be organized. Provide only what is asked of you; do not be too eager to provide other information aside from what is being asked. Be honest, precise and conscious. Read between the lines; see where the questions are driving at.

Do not give them copies of documents that have no duplicate, I repeat, never give them the originals. There is no need to be  stiff yet do not be too casual either. Act professional; do not argue, provoke or insult them, as these agents have the power to make you miserable or smooth your process. Do not sign anything until it has been reviewed by a legal expert.

With The Help of an Experienced Tax Advisor

Even before the actual audit, a tax advisor can help plan, organize and prepare for your business audit. Experienced in dealing with audits of business tax filings they will know what to expect and can help you proactively meet your obligations. Since these are professional who are trained to handle IRS tas problems, they will help you navigate the IRS audit successfully.

Additionally, your tax professional has no personal attachment to your business, and will be able to help outside of the emotion caused by the threat to your business. And since handling an audit is their business, the best IRS problem resolution professional will have a proven, effective track record of solving IRS tax problems.

If your business is being audited by the IRS, contact us immediately, every second counts and preparing to organize the fight takes time.  Give yourself the peace of mind knowing that a seasoned professional is helping you face your IRS business audit in a legal, ethical and effective means.  Find out how we can help you today.

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