No one wants to be audited, and no one wants to receive a tax audits letter from the IRS. A tax audit is a scary proposition. However, a tax audits letter does not necessarily mean that you have done anything wrong. Rather, the letter actually tells you that the IRS is planning to review a few items on your return, to ensure that they are reported correctly. Furthermore, the letter will also tell you that the IRS may question the validity of what you have stated.
Unfortunately, tax audits are costly and extremely time-consuming. This is particularly true if the revenue agent assigned to your case is overwhelmed by the document requests. However, swift action can reduce the aggravation caused by tax audits. Unless you did something seriously wrong in your tax return, you do not have to worry about criminal prosecution.
The Advantage of Calling a Tax Professional
You may consider handing your tax problems on your own. However, referring to professional tax representation can give you a significant advantage. One of the reasons is that some IRS agents have the tendency to be inflexible on taxpayers, because they know that they have more in-depth knowledge of the procedure than the taxpayer. As you can see this this gives them a key advantage in the fight.
With a skilled representative on your side, you can turn the tables on the agent and neutralize their advantage. Furthermore, having a tax professional representing you at the audit will prevent you from being cross-examined. Keep in mind that the primary goal of most tax audits is to limit the flow of information. But it is difficult for a taxpayer to avoid being questioned. That being said know this, anything you say can and likely will be used against you.
When encountering an IRS agent, you may get nervous. Worse, you could overstate or provide false information. But you have to remember that false statements are considered a serious offense.
Because tax audits are examinations of your business and “personal” financial situations, you may become emotional during the course. With the help of a tax professional, you can take that emotion out of the process. Using this approach, you can establish a working relationship with the auditor. In fact, most IRS agents prefer working with representatives vs. dealing directly with the tax payer.
Does It Signal That You Did Anything Wrong?
Some of our clients ask us if hiring a tax lawyer might signal to the auditor that they did something wrong. We always tell them that hiring a professional representation would indicate to the IRS agent that you are taking the audit seriously. Having a representative can minimize your paperwork and shorten the process. This is an advantage for both sides and it can lead to a better outcome.
In other words, we suggest you work with a skilled representative before you make the decision of handling the tax audits by yourself.
Call us today for a free, no obligation consultation regarding your audit: 800-950-2237