If you look at a map of the United States marking recent IRS audit history, the southern portion, particularly the state of Texas, experiences more than its fair share of IRS audits. In Harris County alone, there were 8.2 audits for every 1,000 filings. The national average is 7.7.
The audit is part and parcel of capitalism, a check and balance on the payment of taxes owed by individuals and businesses. An IRS audit can also be extremely stressful, even if you believe that your return was accurate. Retaining an experienced IRS audit attorney who can help you know what to expect during the audit can help you face the whole process with confidence.
At the Law Office of Joseph Onwuteaka, P.C., I use my expertise as a skilled tax attorney and a certified public accountant to represent clients in Houston, Texas, Harris County, and the surrounding areas as they navigate IRS audits.
Few audits are triggered because the IRS found a mathematical error on your return. Most are triggered due to the type of income you earn, the type of employment you have, the number of deductions you make, and the amount of income you earn. Any of the following circumstances can trigger an audit:
The IRS’s computer notices an anomaly, including duplicate dependents and odd deductions
You earn significant income or very little income or overlooked income reported by others who paid you
You itemized a large number of deductions or took deductions for hobbies
You spent or deposited a significant amount of cash or operate a cash-based business
You are self-employed and/or have a home-based business
You own assets in a foreign country
You have significant investment income
When the IRS notifies you via mail or telephone that you are to be audited, they will detail what information you will need to provide, including supporting documentation. The first thing you should do is locate all necessary documents, make copies for the auditor, and organize them. If you realize that you are missing some of the documents the auditor will need to review, request copies right away so that you can have them ready for the auditor.
Consulting with a tax attorney upon notification of the audit can also be a very wise decision. Your attorney will be able to review the notice and assist you with your response, which is required within 30 days of the notice. Your attorney will also be able to help you gather and organize all of the necessary documents that will be pertinent to the audit. Above all, your tax attorney can advise you regarding the reason for the audit and help you anticipate what the auditor is looking for, and may find, during the process.
Audits are conducted in person, either at your home or at an IRS office. You can choose whether or not to attend the audit on your own. You may also either have your attorney or tax professional represent you, or have them attend the audit with you. The auditor may ask you questions during the review or request additional documents. Having a tax attorney there with you can help reduce your anxiety level as you respond to these requests.
The IRS grants that you have the following rights during an audit:
The right to professional and courteous treatment
The right to privacy and confidentiality
The right to know why certain information is being requested and the consequences if you do not produce it
The right to representation during the audit
The right to appeal disputes to both the IRS and in a court of law
Navigating an IRS audit inherently involves a significant amount of silence, during which most people become anxious and nervous. It is difficult to sit quietly while the auditor peruses the documents you have produced and takes notes without comment.
The value of hiring an experienced and knowledgeable tax attorney to help you answer, prepare, and either accept or appeal the audit outcome can make the entire process easier. Unless you have been through an audit before, or understand fully the issues raised by the IRS, it can be extremely beneficial to have an experienced IRS audit attorney on your side to advocate for your rights.
When you choose to work with my firm, the Law Office of Joseph Onwuteaka, P.C., you will have an attorney on your side who is uniquely qualified to represent clients during IRS audits. I am not only a tax attorney, but a certified public accountant and an IRS Enrolled Agent. That is why clients from Houston, Texas, and throughout Harris County come to me when they receive an audit notice from the IRS.
If you have received an audit notice, don’t delay. Call my office today to schedule a consultation and allow me to begin helping you through this stressful event.