complain to. Remember that these bureaucrats say they are on your side, but ultimatelythe government writes their paychecks. They have no real economic incentive to makesure you win. Atax lawyer does.The IRS web site is a mess when it comes to finding tips on how to survive an audit.The best publication to get you started isIRS Publication 556.If you feel confused by
this IRS document, you're not alone. Making sense of "IRS help documents" is whatkeeps tax attorneys in business. Tax lawyers understand how a comma vs. a semicoloncan drastically change the tax resolution you get from your IRS audit.You can find a lot of advice on how to survive anIRS auditonline.Nolo.comhas a very
good (if slightly flawed) taxes and audit section. Here you'll get solid tax advice like:
Don't answer unless asked.
Give the auditor no more information than she isentitled to, and don't talk any more during the audit than is absolutely necessary.Don't give copies of other years' tax returns to the auditor. In fact, don't bring toan audit any documents that do not pertain to the year under audit, or were notspecifically requested by the audit notice.
Know your rights.
Browse IRS Publication 1, explaining the Taxpayers' Bill of Rights, prior to your audit. If the audit is not going well, demand a recess toconsult a tax pro. Ask to speak to the auditor's manager if you think the auditor istreating you unfairly. If the subject of tax fraud comes up during an audit, don't tryto handle it yourself.
Appeal the results.
When you get the examination report, call the auditor if youdon't understand or agree with it. Meet with her or her manager to see if you canreach a compromise. If you can't live with an audit result, you may appeal withinthe IRS or go on to tax court.Roy Lewis atMotley Foollikens going into an IRS audit without a tax lawyer to"removing your own appendix," but he offers a few nuggets of IRS advice including:
Organize your records.
Making the auditor's job easier will win you somepoints. The auditor will at least believe that you're an organized person and thatall of your items are documented and justified. Don't be afraid to group the itemsin question, or attach an adding-machine tape that matches the tax return. Thatwill allow the auditor to quickly review the important issues. Don't believe thosewho tell you that you can just throw your records in a bag, drop it on the auditor'sdesk, and shout, "You figure it out!" That just doesn't work. Remember, it's your legal responsibility to prove your deductions.
Replace missing records.
If you're going through your records and find thatsome of them are missing, call for duplicates immediately. Don't just go to theaudit and claim that the records are missing or lost. That does you no good at all.