You received an audit notice from the Internal Revenue Service (IRS). What now? What do you need to know about the audit process, and what can (and should) you do to protect yourself?
Federal tax audits can present substantial risks for New York residents and businesses. Whether you are facing a correspondence audit, office audit or field audit, an unfavorable result could lead to substantial liability for back taxes, interest and penalties. As a result, you are right to be thinking about what you need to be doing—and there are some important steps you should take right away.
What To Do When Facing an IRS Tax Audit in New York
Here are some important steps to take if you are facing an IRS tax audit in New York:
1. Carefully Review Your IRS Tax Audit Notice
The first step you should take is to carefully review your audit notice or letter from the IRS. You should try to discern as much information as you can about why you are being audited and what the IRS believes you may have done wrong. When facing an IRS tax audit, informed decision-making is critical, so the more insights you can draw from the IRS’s communication, the better.
2. Make Sure You Know What You Need to Do (and When)
You should also make sure you know what you need to do in response to the IRS’s audit notice or letter—and you should be sure to identify any deadlines that apply. If you do nothing (or if you respond too late), the IRS will proceed without your involvement, and this will almost certainly lead to an unfavorable outcome.
3. Collect All Relevant Tax and Financial Documentation
To determine your best approach to defending against the IRS’s audit, you will need to collect all relevant tax and financial documentation. Depending on the focus of the audit, this could include your tax returns, income records, account statements and various other forms of documentation. This step is critical for informed decision-making as well, and you need to be sure that you know what (if anything) the IRS is going to find.
4. Avoid Making Any Assumptions
The fact that you are facing an IRS tax audit does not necessarily mean that you have done anything wrong. When facing an audit, you need to avoid making any assumptions—and instead focus on making sound and strategic decisions.
5. Consult with an Experienced New York Tax Lawyer
To ensure that you are making sound and strategic decisions (while also avoiding potentially costly assumptions and mistakes), you should consult with an experienced New York tax lawyer as soon as possible. An experienced lawyer will not only be able to help you understand any risks you are facing, but will also be able to deal with the IRS effectively on your behalf.
Request a Confidential Consultation with a New York Tax Lawyer at Thorn Law Group
Are you facing an IRS tax audit in New York? If so, we invite you to contact us for a confidential consultation. To request an appointment with a New York tax lawyer at Thorn Law Group, call (914) 534-6004 or tell us how we can reach you online today.
