In an effort to verify the accuracy of tax returns and compliance with legal requirements, the Internal Revenue Service (IRS) often performs audits on previously filed tax returns. Audits do not always lead to penalties, additional payments, or legal action, but if you recently received an audit notice from the IRS, it is still important to speak with an experienced Florida tax attorney who can help explain your legal options and taxpayer rights.
The IRS uses a variety of methods when selecting a person or business for an audit, including:
- Computer-based random selection;
- Review of tax return information; and
- Information provided by another state agency.
Once a notice of an impending audit is sent to a taxpayer, the IRS conducts one of two types of audits. One type, known as a desk audit, takes place in an IRS office. Field audits, on the other hand, are conducted at a taxpayer’s place of business. Regardless of the type of audit being conducted, taxpayers will most likely be required to provide a series of financial documentation, including, but not limited to:
- Federal income tax returns;
- State tax returns;
- Property records;
- Cash receipts;
- Purchase and sales records;
- Documentation verifying the amounts entered on tax returns;
- Evidence of a sales tax exemption or resale certificates.
All taxpayers have certain tax-related rights when being audited, including the right to:
- Be informed of what is needed to comply with tax law;
- Prompt, courteous, and professional assistance and clear communications from the IRS;
- Pay only the amount of tax legally due, including any interest and penalties that may have accrued;
- Raise objections and provide additional documentation during formal IRS actions and receive a response if the IRS disagrees with the taxpayer’s position;
- A fair appeal of most IRS decisions and the right to receive a written response regarding the final decision;
- Know the amount of time that is available to challenge the IRS and receive notice when the IRS has concluded an audit;
- Expect that the IRS action will comply with the law and respect due process rights and search and seizure protections;
- Expect that information provided to the IRS will not be disclosed without authorization;
- Retain a legal representative for assistance; and
- Expect the IRS to consider individual circumstances that may affect liability or the ability to provide information in a timely manner.
Contact an Experienced Florida Tax Attorney Today
Many residents and business owners dread tax audits. While the process can be stressful, taxpayers are granted rights that give them a certain measure of control over how the audit proceeds. If you live in Daytona Beach, Orlando, Miami, or Jacksonville and you have received notice that you or your business will be audited, please contact Ronald Cutler, P.A. by calling 386-788-4480 and we will help you schedule an initial consultation with a dedicated and experienced tax lawyer. We understand that you lead a busy life, so if you are unable to meet during the week, we would be happy to schedule a weekend meeting to ensure that your case receives the personalized attention it deserves.