Understanding the Various Types of IRS Audits
There are several types of tax audits under U.S. tax law that are conducted by the Internal Revenue Service (IRS). These include correspondence audits, office audits, field audits, and criminal investigations. A tax attorney can help you if you are selected for one of these audits by representing you during the audit process, negotiating with the IRS on your behalf, and providing guidance on how to respond to audit inquiries.
Correspondence audits are the most common type of audit and are typically conducted by mail. These audits focus on a specific issue or aspect of your tax return and may involve requesting additional documentation or clarification on certain items. The IRS may request proof of charitable donations, business expenses, or other deductions claimed on your tax return. If you are selected for a correspondence audit, it is important to respond promptly and provide the requested information or documentation. A tax attorney can help you gather and prepare the necessary documents and ensure that your response is complete and accurate.
Office audits are similar to correspondence audits, but they are conducted at an IRS office rather than by mail. These audits are generally more in-depth and may involve face-to-face meetings with an IRS auditor. Office audits may also involve reviewing multiple tax returns, rather than just one specific issue. If you are selected for an office audit, it is important to prepare and bring all relevant documentation, such as receipts and records of income and expenses. A tax attorney can help you prepare for an office audit by reviewing your records and identifying any potential issues that may be raised during the audit.
Field audits are the most comprehensive type of audit and involve a visit to your home or place of business by an IRS auditor. These audits are typically conducted when the IRS has significant concerns about the accuracy of your tax return or when there are discrepancies that cannot be resolved through a correspondence or office audit. Field audits are generally more complex and may involve reviewing multiple tax returns and examining financial records in detail. If you are selected for a field audit, it is important to have legal representation to ensure that your rights are protected and that the audit is conducted fairly. A tax attorney can help you prepare for a field audit by reviewing your records and assisting with the preparation of documents and responses to audit inquiries.
Criminal investigations are a separate type of audit that are conducted by the IRS Criminal Investigation Division (CID). These investigations are typically reserved for cases where the IRS believes that there may be criminal tax fraud or evasion. Criminal investigations involve a thorough review of financial records and may involve interviews with individuals who have knowledge of the financial affairs of the taxpayer. If you are selected for a criminal investigation, it is imperative to seek legal representation as soon as possible. A tax attorney can help you understand your rights and protect your interests during the investigation process.
If you are selected for any type of tax audit, it is important to seek legal representation to ensure that your rights are protected and that the audit is conducted fairly. A tax attorney can help you understand the audit process, prepare for the audit, and represent you during the audit. They can also provide guidance on how to respond to audit inquiries and negotiate with the IRS on your behalf to achieve a favorable outcome. Ultimately, a tax attorney can help you minimize the risk of penalties and fines and ensure that you are in compliance with tax laws.