Four Steps to Take if Your Business is Audited

By May 6, 2014August 28th, 20142014, Tax Tips

How to Handle an Impending Audit

No matter how carefully you prepare and file your taxes, the IRS may still choose to audit your company. This can be due to a taxesdiscrepancy that their computer noted, unfiled tax returns, or you may have simply been selected randomly. You will always receive a letter in the mail informing you of the impending audit. What should you do?

  1. Call your trusted financial advisor immediately. Your advisor can help you find out why the IRS is choosing to audit your company and therefore narrow down the documentation you will need to have prepared for the day of the audit. ATS is able to represent you during the audit, once a power of attorney is executed with the taxing agency.
  2. Start pulling your documents. Remember that the IRS can audit you any time within three years of a tax return so while it’s 2014 you could receive a notice for a 2011 filing. Make it a practice before you ever receive an audit notice to always keep and file documentation and receipts. This will ease the process of compiling your information and allow you to prepare quickly for your audit.
  3. Remain calm. An IRS audit is no reason to panic, and much of the time is due to random selection or a relatively minor error. If you feel like you do have a cause for concern take it up with your trusted financial advisor long before the audit begins and ensure that you are protected. You will want to be honest about any concerns you have with your advisor so they can be prepared for what’s to come and can intervene on your behalf.
  4. Don’t sign anything! Never sign any decisions or documents until your trusted advisor has had the chance to review them. You are well within your rights to insist that your representation review a document before you put pen to paper. If the decision made is negative you will want your financial advisor to review the document and the appeals process to ensure you are able to file a timely appeal to protect your business.

When those unwanted letters arrive in the mail, ATS should be your first call. Our highly trained and experienced accounting management solutions advisors can help guide you through the process from beginning to end. Call us today at 303-232-8300 – you don’t want to wait until after you’ve received an audit notice to start taking control of your finances and your tax filings.

Accounting & Tax Solutions

Author Accounting & Tax Solutions

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