The IRS will always notify you in writing. I say “always” because
there are many scams going on in which a scammer will call someone at
home and say, “I work for the IRS,” or “I work for the
Department of Treasury,” which is the government department that
contains the IRS. They’ll say, “We work for the IRS and you’re
in trouble; you’ve done something wrong,” and they’ll
say, “Pay us some money now.”
In those cases, people think they’re being audited or for some reason
they’ve been audited and they didn’t know about it, so they
get really scared. I’ve had people call me and say that they received
one of these phone calls and I had to assure them the IRS will always
notify them in writing if they’re being audited, so they don’t
have to worry about that.
The IRS sends the notice of an audit (they call it an “examination”)
to the last address they have on record for you. If you’ve moved,
it’s possible it may have been mailed to your old address and you
won’t find out about it if you aren’t having your mail forwarded.
When you move, you should notify the IRS of your new address. You can
download IRS Form 8822 from irs.gov and follow the instructions.
Often times, people who are behind in filing and paying their taxes or
who have been notified they are being audited, go into denial mode and
pretend their tax problems don’t exists. The IRS will send correspondence,
but people will ignore it, and claim they never received what the IRS
sent them. This is a bad idea because you will eventually lose certain
important rights (such as the right to an appeal or the right to go to
Tax Court) if you ignore the IRS’s notices for too long.
Are There Scams Conducted Through Phones And Emails As Well?
Yes, there are many scammers out there pretending they work for the IRS.
One popular scam is to send out emails stating that some action needs
to be taken regarding your tax refund or your IRS account. The email will
instruct you to click on an attachment, which obviously you don’t
want to do.
The IRS does not send notifications of an audit or other official correspondence
What Are The Things You Should Do When You Find Out That You Are Being Audited?
Usually, the letter from the IRS will specify particular items in the tax
return that the auditor is interested in. For example, the might say they
want to look at your charitable contribution deduction. If you have a
business, the might want to examine your revenue or certain business deductions.
If you have good records, then it should be pretty obvious what documents
you will need to respond to the letter. But if you don’t have good
records, it might be less obvious and that’s where it may start
to become problematic or more difficult to think about how you should respond.
Ask yourself how did I come up with this number on your tax return. Did
you go through your checkbook? Did you save all the receipts? Did you
pay them with credit card? What sort of paper trail do you have to support
You just have to start thinking along those lines. If you have a good record
keeping system, like I said, it should be pretty obvious. If you don’t,
you need to start scrambling a bit and go on to plan B and think about
how best to provide support for the number. That’s where the assistance
of someone who’s experienced with tax audits can really help.
I know what sort of documents they’re going to like and what they’re
not going to like. I know the potential problems that can come up, for
example, with bank statements or credit card statements, or with documents
substantiating charitable contributions. I can really help a lot there.
That’s the number one problem with getting ready for an audit; putting
together the documents to support it. It’s not that people have
done something wrong; it’s just that, for whatever reason, the paper
trail isn’t ideally organized.
For more information on
Discovering If You Are Being Audited, please call
(510) 444-4430 today to schedule a free initial consultation. Get the information and
legal answers you’re seeking.