In previous blogs we’ve talked a lot about the things you should do in order to survive an IRS tax audit. There are many actions you can take to prepare and steps you can utilize to protect your rights. But while there are plenty of things you can do that will make an IRS audit go more smoothly, there is also a good deal you can do that will make an already stressful and precarious situation much worse.
If handled correctly, IRS audits do not have to be a terrible experience—but depending on your actions, they certainly can be.
In this two-part blog series we will detail ten things you should NOT do when faced with an IRS audit. Please keep in mind, this blog does not constitute legal advice for your specific situation, so please contact Morgan Maxwell today for help and guidance on how best to handle your IRS tax dispute.
Do NOT panic
The worst thing you can do when you receive a notice from the IRS that you are going to be audited is panic. You do not have to fear the IRS. With the right guidance and preparation, you will be able to handle anything they can throw at you. Panicking will only cause you to act rashly and make poor decisions that could result in serious consequences. Take a deep breath, and make a plan.
Do NOT do nothing
Remaining calm, however, does not mean sitting back and doing nothing. An IRS audit should not be feared, but it is a serious affair and you do need to take steps to prepare yourself. If you do not take proactive measures to combat the audit, you could find yourself oweing a great deal of money.
Do NOT try to go it alone
The fact is, you are probably not a tax or legal professional. The IRS is as familiar with US tax law as one can be, which is why you need a tax law professional to intercede on your behalf. Not only can an attorney like Morgan Maxwell utilize his years of knowledge and experience to help you properly prepare and handle an audit, you can also grant him Power of Attorney so that he can be the one to directly deal with the IRS for you. If you try to go it alone, you run the risk of making very costly errors throughout the IRS audit process.
Do NOT give more information than necessary
You should never give the IRS any more than the bare minimum that they need or request. If you volunteer more than what they ask for, you are opening the door for them to find other taxes that you need to pay that they otherwise would not have discovered. Limit the scope of the audit to only what the IRS needs to investigate the specific issue that triggered the audit.
Do NOT try to conceal or lie
As we just stated, don’t give the IRS more than they need, but you should also never try to lie or conceal things from them. The risks (potentially being charged with fraud) far outweigh the rewards (saving some money on your taxes) of lying to the IRS. Be honest and never try to hide your assets, otherwise your tax issues could turn into criminal issues.
Be sure to check back soon for Part 2 of this blog where we will detail five more things you should never do during an IRS audit. If you have questions about the IRS or you need help with a tax dispute or audit, please contact Morgan Maxwell today.
Written by E. Morgan Maxwell
Since beginning his own firm, Mr. Maxwell has continued a tax-law oriented practice encompassing a wide range of transactions, planning and dispute resolution. His dispute resolution experience includes involvement at all levels of the Internal Revenue Service (Examinations, Appeals, Collections, Office of Professional Responsibility, the U.S. Tax Court), the Pennsylvania Department of Revenue, the Tax Litigation Section of the Pennsylvania Attorney General’s Office, Pennsylvania Commonwealth Court, Common Pleas Court and local taxing jurisdictions in southeastern Pennsylvania.
