How to Prepare for an IRS Audit

Hudson, NH Resident Seeks Advice

While the number of individuals audited is small in comparison to returns, it does not necessarily imply a suspicion of criminal activity.  Tax returns that have any unusual deduction, conflicting calculations or are missing paperwork may be flagged for an audit.  After you receive a letter from the IRS indicating that you are being audited you will have thirty days to respond.  In the letter, the IRS will indicate the paperwork that is needed and these 30 days should be used gathering this information and supplying it to the IRS.

A Hudson resident received a letter in the mail form the IRS indicating that his most recent tax return would be audited.  Panicked, he contacted the experts at Merrimack Tax Associates for help.

Reasons that the IRS May Audit a Taxpayer

Some deductions increase the likelihood that you will be audited by the IRS.  These include home office deductions, rental losses, business use of a vehicle and hobby-related deductions.  If there is an error in the math or a discrepancy in the paperwork, this may also trigger an IRS audit.  Depending on the reason for the audit and the severity of the discrepancy, the course of action may be anything from sending in missing paperwork to an IRS agent visiting your home.

Paperwork that May Need to Be Gathered

There are a number of documents that the IRS may ask you to provide in support of your tax return.  These may include pay stubs, retirement account records, home mortgage statements, previous tax returns and receipts to verify your deductions.  When being audited by the IRS, it is almost always a good idea to seek professional help and advice.  The experts at Merrimack Tax Associates have assisted countless clients through an IRS audit.  The Hudson resident opted to enlist the support of the Merrimack Tax team and has already been able to provide the IRS with the necessary paperwork that they requested.