No three words in the English language can strike as much fear into the heart of the American taxpayer as IRS Tax Audit. In many minds, the IRS Agent has bradley witham reached the same level of infamy as Dracula and the Wolfman. Yet, before you bring a pitchfork to your IRS Audit, let’s take a look at what it really is and what you can do to defend yourself.
An IRS Tax Audit is a process where an IRS Agent questions the correctness of your Income Tax-Return. Being selected for an IRS Audit doesn’t necessarily mean that your Income Tax-Return is incorrect. The IRS is simply calling upon you to verify it. Often, IRS Audits will scrutinize the validity of tax deductions, but in recent years the IRS has begun looking into the validity of your income on a tax return.
The first type of IRS Audit is the correspondence audit. A live IRS Tax Agent may never see your Income Tax-Return, but you can be audited anyway. The IRS computers scrutinize thousands of Returns each year. If a problem is found, you will receive an IRS Tax Audit Correspondence. The IRS asks you to provide proof of the claims on your Income Tax-Return via certified mail. Your adjusted Income Tax Return will then be reviewed. If the matter is not settled at that point, you may have to go to a face-to-face Tax Audit with an IRS Agent.