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What is an IRS Field Audit and What Should You Do?

What is an IRS field audit and what should you do if you receive notification from the IRS regarding their intention to conduct a field audit?  An IRS field audit is an examination in your home, business or your accountant/attorney’s office.  An IRS field audit usually involves an examination of your entire return and may span 2 or 3 years.  These are usually required when your returns have complex issues such as international investment and FBARs or business ownership or professional practice.  The IRS wants to meet with you and your representative(s).

If they ask to come to your home this is almost never in your best interest.  Do not trust the IRS agent, provide any information or think there is anything you can do to get on their “good side.”  You should never communicate directly with an IRS representative without legal counsel.

You need expert legal, tax and accounting representation.  Allen Barron provides integrated tax, legal and accounting services as well as business advisory services.  We are well positioned to support and advise you through an IRS field audit and what should you do to protect your interests.  We will do everything possible to limit the extent of risk associated with the IRS audit and the financial consequences, if any.

We should be able to choose the location of the audit.  Allowing the IRS to come to your home allows the IRS agent to examine your personal lifestyle and learn things about you which can be matched to your tax returns.  This is not in your best interest.  You always have time to respond to IRS inquiries for information and documentation.  The information requested in audit notification letter helps Allen Barron to determine the IRS’ strategy for the audit and how best to protect you and your interests.  An IRS audit is a complex process, and a field audit means the IRS believes they will be able to recover a lot of money from you, the taxpayer.  They are not going to go to the time and expense of a field audit unless they think there is sufficient reason and financial gain for the agency in the form of additional taxes, penalties and interest.

Learn more about what is an IRS field audit and what should you do if you are notified by the IRS.  We invite you to contact Allen Barron or call 866-631-3470 for a free consultation.  You may wish to download our free white paper “What to Expect from an IRS Audit.”  It will provide a lot of useful insight into the process and provide critical insight on how to conduct yourself and why it is important to seek expert representation.