The mere thought of a tax audit can send chills down most people’s backs — and there’s no question that the Internal Revenue Service (IRS) audit process is stressful, complicated and overwhelming for most people.
Audits can happen for all kinds of reasons. You can be randomly chosen, or discrepancies in your reported income and excessive deductions can trigger the agency’s attention. Either way, an audit typically begins with a letter informing you that you or your business is under review. Typically, you’re given 30 days to respond to the notice — and you should spend some of that time seeking informed legal guidance. Here’s why IRS audit representation is essential:
1. You need someone familiar with tax laws and procedures
The tax laws in this nation are among the most complex in the world, and they can be very hard for a layperson to navigate. Professionals, including tax attorneys and accountants, understand the nuances of tax law and can interpret the IRS’s requests correctly (and narrowly) so to best safeguard your interests.
2. You want to minimize the potential for errors and miscommunication
A simple mistake or miscommunication can escalate the situation and turn something benign into trouble. An experienced representative can make sure that your correspondence with the IRS is accurate — and they become your intermediary, able to translate IRS language into understandable terms that you can follow.
3. You need to protect your rights in this situation
Most taxpayers are unaware of their rights during an audit — such as the right to appeal decisions. IRS audit representation helps make certain that you are treated fairly and your rights are respected. If the audit doesn’t go your way, your representative can immediately initiate an appeal or help you approach the IRS with the idea of crafting a way to minimize the consequences of any additional tax liabilities that are assessed.
4. You can reduce the stress you experience and minimize time waste
An audit can be both an emotional drain and time-consuming. If you’re in business for yourself, that can have significant repercussions for your company. With the right representation, you can delegate the burden of the process to another so that you can concentrate on keeping your business operational.
Ultimately, with professional representation, you are more likely to achieve a positive outcome. This is particularly true if you are unsure why you are being audited, there is a significant sum of money involved, you are worried you may have made errors on your tax returns or you’re accused of serious tax violations or fraud.
