In our last blog we explained five things you should NOT do when faced with an IRS audit, including panicking, doing nothing, facing the audit alone, volunteering unnecessary information, and lying.
With the help of an experienced tax law professional like Morgan Maxwell, an IRS audit can go incredibly smoothly, but if you handle the situation incorrectly, it can turn into the nightmare most people imagine IRS audits to be.
In Part II of this blog, we have listed five more fatal mistakes that all taxpayers should avoid when dealing with an IRS audit. If you have questions or need more information, please contact the law office of E. Morgan Maxwell.
Do NOT rush to get the audit over with
Successfully surviving an IRS audit entails thorough preparation. Many people’s instinct when faced with an audit is to try to get it over with as quickly as possible. This is a terrible course of action that will lead to sloppy mistakes. Take as much time as you can to prepare everything you need to effectively present your case to the IRS agent. Ask for extensions if necessary to ensure that you are as fully prepared as you can possibly be.
Do NOT be disrespectful to the agent
Many people react to IRS audits emotionally, causing them to be aggressive and disrespectful to the auditing IRS agent. No matter how frustrated you get, this will only hurt your case. The agent is just a person trying to do his or her job, and while reacting politely and respectfully may not necessarily help your case, reacting angrily and rudely almost certainly will hurt your case.
Do NOT sign anything you don’t understand
You are entitled to a complete understanding of the audit process as well as the actions taken and decisions made by the agent. This is another reason why it is so essential to utilize an experienced professional when dealing with an audit, so they can explain the intricacies of the situation and make sure you are fully aware of everything going on. An IRS agent may tell you that you need to sign a document, and if you do not understand what it means, you could be agreeing to something that limits your options or hurts your case.
Do NOT make statements that you aren’t 100% positive about
Many taxpayers think they have to have an answer for every question the auditor asks them. This is simply not true. If you do not know the answer to a question, or you are not entirely certain about the answer, say so. Let the auditor know that you will need to find out and get back to him or her with the answer. Accuracy and honesty are essential to surviving your audit, and by making statements that you are not certain about, you could be doing more harm than good.
Do NOT assume the IRS agent is correct
IRS agents are human, and they make mistakes just like the rest of us. Don’t assume that the agent has calculated everything correctly and made all the right decisions about your case. Double check everything, make sure you understand it all, and if something doesn’t seem right, follow up on it.
Do not allow an impending IRS audit to make you feel helpless or overwhelmed. You have the power to make the process go smoothly, and with the help of attorney Morgan Maxwell, you will not have to pay a nickel more than you rightfully have to. Avoid the mistakes we’ve listed in this blog, and in Part I of this blog, and you can survive the challenges of the infamous IRS audit.
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.
