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Surviving an IRS Audit

written by: Meg C.•edited by: Donna Cosmato•updated: 6/29/2011

Surviving an IRS audit is not as difficult as you may think. It is understandably frustrating and scary when you find out that you are the subject of an IRS audit. Here are some tips on how you can keep calm and get through an IRS audit in one piece.

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    For one reason or another, the IRS may decide to audit you. Once you are subject to an IRS audit, an IRS agent will come out to your home or to the office of your tax return preparer and look over your financial records. After the IRS audit is complete, the auditor will let you know the results. If you are an honest taxpayer, chances are you will survive an IRS audit with relative ease.

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    Hire a Tax Professional

    If you are concerned, you need to consider contacting a competent CPA, tax attorney, or Registered Agent (RA). These professionals have the ability to represent you in tax court should a dispute arise between you and the IRS. In addition, a professional that is trained to work with the IRS will know what they are looking for and will help you to avoid a run-around. Of course, using the services of a qualified tax professional is not cheap. You can always decide to survive an IRS audit on your own for free. However, if you have taken agressive tax positions or are worried about the quality of your records, you should strongly consider hiring a professional to help you.

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    Organize your Records

    The key to surviving an audit is having adequate records. If you keep quality records, the IRS will be able to re-calculate your tax with relative ease. If the IRS agent has an easy job performing your IRS audit, chances are he or she will be a lot friendlier towards you. A friendly IRS agent makes an IRS audit much easier to survive.

    If you are searching through your records and notice that there are some missing receipts or documentation, find them now. If you don't have the records requested in your IRS audit notice, your deduction could be denied and you could owe more taxes. In addition, make sure that you do not bring any records or documentation not requested on your original IRS audit notice. This will prevent the IRS agent from bringing up issues that may cost you more money in taxes.

    Individuals should keep tax records for three to five years. For the mosts part, the IRS won't audit any return that is over three years old. However, if they suspect tax evasion or fraudulent returns the IRS can go back as many years as they like.

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    Be Nice

    Be nice to the IRS agent. Chances are, they like their job as much as you like yours. An IRS agent is a person just like you. Of course, if an IRS agent tries to start a friendly conversation, don't divulge too much information. Try to answer questions "yes" or "no". The less you talk, the better off you will be.

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