The Many Kinds of Audits

Tax audits can impose a great deal of stress in anyone’s life, but in order to avoid them you must first learn more about what a tax audit entails. Believe it or not, tax audits can come in all shapes and sizes, and below is just a brief list of various ways you can be audited by the IRS.

Tax Audits by Mail

Perhaps surprisingly, most tax audits are conducted by mail. Most commonly these audits are referred to as “correspondence audits” and typically occur if the IRS has questions about your return.

In-Office Tax Audits

In rare cases, the IRS may ask you to attend an in-person audit at your local office. In general, in-office tax audits are usually employed when the IRS has additional questions for your business which cannot be answered with traditional paperwork.

Field Audits

Field audits can be a nightmare, especially if they be unexpected. The IRS will come to your home or business just to gain more insight into your tax return. These audits normally occur if the IRS has lots of issues which a phone conversation will not resolve.

Tax Audit Outcomes

Many people sadly make the assumption that all tax audits are designed to ruin your business or your personal life. In most cases, the IRS will either accept your IRS return at face value or they will ask for other supporting documentation. In rare cases, your tax audit could land you in jail or have your assets frozen.

Surviving an In-Person Audit

Surviving an in-person audit can be a difficult task; however, it is possible. Keep all of your receipts and have documentation that backs up everything.

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