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Tips for Surviving an IRS Audit

18th August 2009
By anders02 in Taxes
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First and foremost, your goal in every tip listed in this article is to convince the IRS that you were entitled to your credits, deductions and exemptions. Additionally, you will need to convince the IRS that you reported all of your income. You should only prove or convince them of the items in question, never going above or beyond.

You should delay the process whenever you can without becoming suspicious. Request more time to gather your records or confer with a professional. You can also request more time to get your records together, and make certain that the records are presented in an orderly fashion. Regardless of why, postponing the audit is usually to your benefit.

You should never have the IRS at your home or at the place of your business. Instead, consider going to the IRS local office to conduct the Audit, or have a tax professional handle it. Field Audits, where the IRS auditor comes to your place, usually happens when there is business income. At very least, you should consult your tax professional, even if he or she will not be handling the audit for you, prior to meeting with the auditor at your home or business.

Always prepare your records in an orderly fashion, arranging bank statements by month, receipts by type or date and invoices by type and month. If you are missing a requested document, you are allowed to reconstruct records.

Do not expect to walk out of an audit without owing something. The odds in any audit are that they will find something. Also, do not attempt to negotiate on the taxes to be paid, instead try to compromise on the tax issues themselves.

Do not produce more documents than requested, keep the chatter down, only answering the questions that you are asked and do not give copies of other years' tax returns to the auditor.

Research and know your rights. There is free IRS publications and commercial tax guides for your assistance. If you are still unclear, consult a professional. Your rights are well defined in the taxpayer's bill of rights. If you believe that your auditor is treating you unfairly contact his supervisor and if tax fraud comes up, seek the advice of a professional immediately.
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