Answer
Answering an audit or an IRS notice
An audit is a set of questions about a return, not an accusation. Most are handled by mail, and most turn on a handful of items: a deduction, a business expense, income the IRS heard about from someone else.
I read the letter, tell you plainly what it's asking and what it isn't, and answer it with the records that support your return. If the IRS has filed a return for you, or says your income doesn't match what an employer or bank reported, the work starts the same way.
Step by step
How an audit usually goes
The order is nearly always the same, whatever the letter is about.
- 01
Step 1: The letter arrives
It names the year, the items under review and a date to respond by. Don't throw away the envelope; its postmark can matter.
- 02
Step 2: We read it together
In a first meeting I tell you what's being asked, what you're likely to need and what I'd expect the work to cost.
- 03
Step 3: I take over the contact
You sign a power of attorney, and from then on the IRS calls and writes to me, not you.
- 04
Step 4: We gather what supports you
Receipts, bank statements, mileage logs, a letter from your accountant. Where a record is missing, we rebuild it from what exists.
- 05
Step 5: The examiner's report
The audit ends with a report: no change, a change you accept, or a change you don't.
- 06
Step 6: If you disagree
You can ask for an appeal inside the IRS, and in many cases take the question to the U.S. Tax Court before paying anything.
Audit questions
Does an audit mean I did something wrong?
No. Returns are chosen for many reasons, including a computer comparing yours to others like it. Plenty of audits end with no change, or with a small one.
How far back can the IRS go?
Usually three years from when you filed, longer in some situations, such as a large amount of income left off a return. If you never filed, the clock hasn't started.
What if I can't find my receipts?
We work from what does exist: bank and card statements, emails, calendars and the other side's records. A reasonable reconstruction is often accepted.
Should I just pay what the letter says?
Not before someone has checked it. Notices are sometimes wrong, and paying can make it harder to dispute later.
Have an audit letter?
Send a short note or call. We'll set a first meeting before your response date.
Please don't send tax documents, Social Security numbers or account numbers through this site.