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What should you know when IRS audit

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What should you know when IRS audit  Reply with quote  

An IRS audit is a review/examination of an organization’s or individual’s accounts and financial information to ensure information is being reported correctly, according to the tax laws, to verify the amount of tax reported is accurate.

Should you get to know more details about Audits process, see more in Publication 556, Examination of Returns, Appeal Rights and Claims for Refund on IRS website.

Also, enlighten yourself from a quick study on Frequently asked questions..

Audit Selection

Selecting a return for audit does not always suggest that an error has been made. Returns are selected using a variety of methods, including:

Random selection and computer screening – sometimes returns are selected based solely on a statistical formula.
Document matching – when payor records, such as Forms W-2 or Form 1099, don’t match the information reported.
Related examinations – returns may be selected for audit when they involve issues or transactions with other taxpayers, such as business partners or investors, whose returns were selected for audit...

You can read more at my blog tirotax
Post Wed Jan 07, 2015 3:38 am
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Thanks for the warning Very Happy
Post Wed Jan 21, 2015 3:25 pm
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These are actually some pretty good bits of information. One of my best friends (who owns his own business) recently had an audit (well last year) and he said that it is an extremely frustrating experience if you are not prepared for it, because they will ask you for anything and everything.
Post Wed Feb 11, 2015 7:05 am
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My small business triggered an audit several years ago. It went well and was pretty easy.

I just made sure that all of my paperwork was in order, with a file for each client and one for each supplier, all in chronological order so that anything asked for was at my fingertips...made the audit a more straightforward thing to get through.
Post Wed Feb 11, 2015 5:43 pm
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