A tax audit conducted by an IRS professional often occurs when the IRS needs to confirm some details on a tax return form and determine accuracy. Approximately one in 75 men and women get audited by the IRS. It means that 80 percent of all men and women will get audited at some point during their working lifetime. However, it is not always random. Those who get selected are often people who have a much higher likelihood of making an error or fraudulent claims on the tax return.
The IRS computer is the main force that determines who gets audited and who does not. All tax returns are given a score by the computer and the higher the score, the higher the potential of getting audited. The computer locates individuals who have a low income but high expenses. For example, if a person lists their income and mortgage payment and it is around the same amount, the computer will assign a high school because of the overall likelihood of affording the mortgage and all other monthly expenses.
When audited, the IRS determines if all income has been properly reported and the person filed everything correctly. The IRS is known to “win” a majority of the audits because the taxpayer is unable to provide all necessary documents. Because of this reason alone, audits can be kind of scary. Most individuals are unsure of all tax laws and what they need to provide to the auditor. It is this reason that many end up owing the IRS money. Rather than get frustrated and anxious about an upcoming audit, it is best to hire an experienced tax professional. A good tax official, such as a tax attorney, CPA, or enrolled agent can assist in looking for all the possibilities that will ensure a positive financial outcome at the conclusion of the audit.
If a person is selected for an audit, they will most likely require the assistance of a professional that is able to defend them and guarantee that the IRS and/or state taxing authority will not take complete control as well as an arm and a leg in the process. Even if the trigger for the audit was due to an error in filing, it is possible the individual missed a number of important deductions that may offset any mistake. It is essential to work with an experienced tax professional that has the necessary training and experience required to handle audits. They can view the case from multiple angles while protecting the interests of their client at the same time.
The goal of any experienced tax professional is to get rid of all financial stress and offer a good service that will offer financial freedom. In fact, in most occasions, the IRS would rather work with an experienced tax professional rather than the individual. Tax professionals fully comprehend the process and all tax-related jargon. They can ensure a smooth transaction between both parties without any further misunderstandings. When using a tax professional, an audit can be quick and painless.
