How to survive an IRS audit
Does the thought of being audited keep you up at night? It’s a good idea to take tax matters seriously, but you might want to expend your energy elsewhere. Why? Audits are rare for the average run-of-the-mill small business. However, if you earn more than $1 million per year, have large charitable deductions, or failed to report all of your income in the past, you might raise some brows. Here’s what to do in the event of an audit situation:
Before your audit
You need to have all your ducks in a row before you argue your case with an IRS agent. Collect and organize any checks, receipts, bank statements, and any other items that substantiate what you reported on your most recent return. If this task seems daunting or you could use some extra support, we’re here to help.
During your small business audit
Know your rights during an audit and what’s within the scope of tax law. The more compliant and willing you are to go through the process with them, the easier it will be. You can lean on a CPA or tax professional during the audit as a subject-matter expert. They can answer questions for you and their experience carries a lot of weight in such a situation.
You will be alerted of the results and have the opportunity to challenge any findings within a 30-day window. If you don’t take any action within 60 days, the report will be considered final.
Audits are no day at the beach, but with the proper due diligence, the likelihood can be reduced. Know that we’re in your corner should such a situation unfold.