What to Do When the IRS Audits You
Don’t panic; call a Texas tax attorney
on March 21, 2019
Updated on January 27, 2023
It’s a nightmare for every taxpayer: an audit by the Internal Revenue Service (IRS). Audits are frustrating, complicated and stressful. No one wants to deal with them.
The good news, however, is that they are somewhat less common than many people realize. According to the most recent publicly available data, the IRS audits approximately 1.1 million tax returns each year. To put that number in perspective, that is less than one percent of all federal tax returns filed in the United States.
As uncommon as they may be, most people still fear that a tax audit means they’re in trouble. Just because you are facing an audit, though, it does not necessarily mean you did anything wrong.
Less Bite Than Bark
Often, the fear surrounding an IRS tax audit is actually far worse than the audit itself. Most IRS audits are selected by a computer system, or they are selected entirely at random. For example, you may face an audit because the IRS office received ‘mismatched information’. In some cases, that mismatched information can be easily resolved.
Take the Time to Read Your Audit Notice
If you are being audited, you should expect to receive an official notice indicating that fact. As explained by the IRS, audit notifications are submitted by mail. You will not receive notice of an IRS audit over the phone. If you do, you are likely dealing with a scam.
In fact, the majority of audits are conducted entirely through the mail—though some businesses or higher income taxpayers may be subject to an in-person audit. Even with a field audit, though, you should receive a written notification before an IRS representative visits you.
Organize Financial Documents and Records
Well-organized documentation is one of the keys to successfully—and painlessly—resolving an IRS audit. If you receive an audit notification, you need to take immediate action. After reading the audit letter and assessing the situation, your next step should be to gather all relevant financial documents and financial records for the tax year. The more information that you have in your possession, the better off you will be.
Get Professional Tax Guidance
Finally, taxpayers should always be ready to seek professional support. Dealing with an IRS audit process or a Texas Comptroller audit can be deeply stressful. You do not have to go through this process by yourself: An experienced legal professional can review the audit notice and all of your available financial records, and help you take the appropriate steps to protect your rights and interests. If you or your business is currently facing an audit from the IRS, you should not hesitate to contact an experienced Texas tax lawyer.
If you want more information on this area of tax law, see our tax overview.