Survive an IRS Audit: Things You Need to Know

A tax audit: Even the most honest of taxpayers may feel terror at the mere mention of those words. Nevertheless, many people go through it, even after their best efforts to file their accurate taxes. Some discrepancies in tax filing are not made intentionally. But these unintentional mistakes easily bring IRS’s attention to the taxpayer. Understanding the audit process, the reasons your return was audited, your rights and obligations, and your options for appealing the results is the best course of action if you find yourself in this situation. Read over here to know how professionals can steer the course clear for a bewildered taxpayer.

1. An audit is not a charge of misconduct

There is no charge brought against you when your return is audited. Simply put, the IRS audit is an unbiased evaluation of your tax return to ascertain its accuracy. It will be required of the taxpayer to provide proof of proper declaration of all of income and qualified for the deductions, credits and exemptions listed. A timeline is also involved. In most cases, the IRS must finish an audit within three years after the filing date of the tax return unless there is tax fraud or a significant understatement of income.

2. The following returns have more chance of running into audit

Factors that can draw the IRS’s attention include as follows:

  • A tax return whose income does not correspond to the 1099s and W-2s you have received.
  • A tax return that deducted alimony.
  • A tax return that includes losses from rental properties.
  • A tax filing that includes earned income tax credits.
  • A return that lacks the necessary schedules.
  • A return for which the necessary alternative minimum tax form is absent.
  • A tax return that was prepared by someone who has a history of issues.