So, your tax returns have been filed; maybe you have sent in your documents and tax payments, maybe you are just sitting back and waiting for your returns to come in. In either case, you are probably ready to put the stress of tax preparation behind you for the time being.
Unfortunately, this won’t be possible if you get audited. If this happens, you can be incredibly frustrated and upset. You will likely also have some serious questions, like why your return was selected for audit in the first place.
Returns are selected for an audit for one of three reasons, according to the IRS:
- You were chosen randomly: Not all returns that are audited are chosen for a specific purpose. A percentage of them are selected by a computer randomly, which means there may be no questions or concerns about your return prompting the audit.
- Returns related to yours involved issues: If your business partner or spouse is audited for a return that raised some questions, your return could also be audited if the IRS has reason to believe your returns are related.
- There are questions about documentation matching: The IRS will examine returns and make sure the information on your tax forms matches the supporting documentation. If there is contradictory, missing or outdated information on these records, you may find your return selected for an audit.
Determining why your return was selected for an audit will be crucial. This information will help you prepare for the audit appropriately.
It is crucial to understand that in the event of an audit, you will need to act fast. Not only will you need to respond to the IRS, you will need to get ready for the audit. Speaking with a tax attorney right away can help you get yourself and the necessary documentation prepared.