It’s your worst nightmare. There’s a knock on your door, you answer, and it’s an IRS revenue officer standing at your doorstep asking for a moment of your time. Getting audited is no laughing matter. If the IRS really wants, it can drag you through the mud, making you dig for documents you never even thought existed. But if you know a bit of the process, and use a bit of savvy, you may be able to navigate your in-person experience with an IRS agent.
Here are a few tips to know in case you’re in this unlucky situation.
Your best move is probably to hire a tax attorney. Chances are, the tax attorney you hire has experience as an IRS agent. They know IRS procedures because one of the biggest responsibilities of a tax attorney is to ensure that the IRS abides by them. Also, anything you tell your tax attorney is protected by the attorney-client privilege. That gives you the ability to be totally honest when it comes to discussing your case. You won’t have that relationship with your accountant.
Ignore an IRS agent’s visit at your own peril. They typically have a wide array of discretion when it comes to pursuing an audit. So if your actions are viewed as uncooperative or evading, you’ll increase the chances of having a wage garnishment or bank levy instituted against you.
Another tip is that knowledge is power. You should know your returns in and out, and have the supporting documents to back them up. You’ll probably be given a request for documents, so having documents at the ready will make things run more smoothly. Be truthful, but don’t give up anything more than you need to. You’ll get asked a lot of questions. Lying to an IRS agent is grounds for a criminal action being brought against you. But that doesn’t mean you need to disclose anything more than you’re asked of. If at any time you think you’ll need help with any questioning, hire a tax attorney.
Most audits are conducted through the mail, with the IRS sending written correspondence, and taxpayers simply mailing them back. The IRS only corresponds with taxpayers via U.S. mail, so that’s how you’ll receive notice of any audit. If you get an email from someone claiming to be an IRS agent, chances are it’s a fake.
Experiencing an IRS field audit can be rough. First, the psychological intimidation of having an IRS agent at your door can be a little unsettling. And, it shows the IRS means business as an IRS revenue officer represents the agency’s collection division.
But the more you know, the better off you’ll be.
Sign up for our newsletter and be the first to find out when exciting IRS news happens. Yes, exciting. We're really into taxes.