Taxpayers who learn they have been selected for an audit by the Internal Revenue Service are likely to feel intimidated and anxious. In many cases, however, the audit process can be relatively simple and painless.
While the IRS claims that its audit process is random, it's easy to feel singled out when facing the prospect of having someone comb through your personal financial and tax documents to ensure accuracy. The IRS notifies individuals that they've been selected for an audit either via U.S. mail or telephone. Upon receiving notice of an IRS audit, it's important to carefully read the document and follow its directives.
The notice contains specific information about what documents or portions of an individual's tax return are being reviewed. A taxpayer is advised to only provide details, documents and information related to those items referenced in an audit notice. It's also important to be responsive with all communications and requests and to meet any IRS-imposed deadlines.
When dealing with an IRS auditor, it's wise to be police and courteous. While no one wants to go through an audit and having their financial records examined and scrutinized, being rude or uncooperative won't help and could in fact prompt an auditor to make additional demands. While taxpayers are advised to be polite, that's not to say that an individual should offer additional or extraneous details or explanations. Keeping conversations and answers short and to the point is always best.
Taxpayers who are selected for an IRS audit would be wise to contact an attorney for advice and assistance. This is particularly true in cases where a taxpayer has concerns about what the audit process may reveal.
Source: The Motley Fool, "How to Survive an IRS Audit," Roy Lewis, May 14, 2015