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Just because you are facing an IRS tax audit doesn’t mean you need to panic. There are actually several different types of audits used by the IRS to determine the accuracy of your return, and some are easier to deal with than others. Regardless of the type of audit you are facing, it is your responsibility to prove to the IRS that you have properly reported all income and taken the correct deductions, and this usually involves submitting the right supporting documents to your auditor. Interestingly, the IRS wins the majority of its audit cases because taxpayers are unable to provide that proper documentation and because they are not aware of the nuances of current tax laws. By securing tax audit representation, you can increase your odds of ending up with a better outcome.

Correspondence Audits

A correspondence audit is the most common type of IRS tax audit and is usually generated after the IRS finds a discrepancy in third-party documentation. In a letter, the IRS will ask for certain documents confirming what you’ve filed on your return, usually either concerning income or specific itemized deductions. This type of audit is conducted through the mail and does not usually require representation by an audit professional. However, contacting a tax professional for this type of audit is certainly advisable if there’s anything you’re unsure of.

Office and Field Audits

If the IRS has requested a face-to-face audit to be conducted at your local IRS office, home, or place of business, now is the time to seek tax audit representation, as this tends to be a much more serious type of audit. In a field/office audit, the IRS requests to meet with you personally, and in that meeting, you may be asked to produce detailed documentation concerning specific items on your tax return. Here, an audit professional can not only help you to better understand the tax law and the issues in question but also assist you in correctly preparing your documentation. In addition, he or she can help to ensure that your words or actions don’t expand the IRS inquiry beyond what was specified in the original audit letter.

Many people choose not to actually attend the audit meeting but send an audit professional to represent them. If you do choose to attend the meeting, your representative can help mediate between you and the IRS official, advising you as to what questions you are legally bound to answer, helping you determine what types of documentation are suitable, and otherwise protecting your legal interests.

Line-by-Line Audits

Although this type of IRS audit is chosen at random, it is detail-intensive and serious, and definitely requires professional tax representation. Under the National Research Program (NRP), the IRS selects taxpayers at random to have every line on their return examined by an auditor. The point of these audits is to give the IRS insight into the accuracy of the process, where future audits need to be targeted, and so on, but if inconsistencies are found, the taxpayer will be penalized. A tax professional will help ensure that any owed additional taxes, interests, and penalties are kept to a minimum

More often than not, an IRS tax audit is going to result in changes to your tax return. By securing tax audit representation, you increase your chances of walking away from your audit satisfied that you haven’t been inappropriately assessed additional tax dollars.