BOOM! 💥 IRS Audit letter landed in your mailbox?

Several factors can trigger an IRS audit, including discrepancies between reported income and information received from employers or banks, excessive deductions relative to income, and random selection.

Yes, you can handle an IRS audit on your own, especially if it's a correspondence audit requesting specific documentation. However, for more complicated audits, such as office or field audits, seeking professional help is advisable.

Audit representation, also known as audit defense, is when a legal or tax professional represents you and your interests during an IRS audit. This professional can communicate with the IRS on your behalf, help gather necessary documents, and negotiate with the IRS if necessary.

Attorneys, certified public accountants (CPAs), and enrolled agents are all qualified to represent taxpayers before the IRS during an audit.

The IRS typically has three years from the date you filed your tax return to initiate an audit. However, if substantial errors are found or fraud is involved, they may go back further.

Don't ignore it; the audit will not go away if you do nothing.

Review the notice to understand what years and items the IRS is questioning.

Gather your tax returns and documentation for the relevant years.

Consider seeking professional audit representation.

If the IRS finds mistakes, they may propose adjustments to your tax liability. You can either agree with these adjustments and make the necessary payments, or you can dispute them if you believe they are incorrect.

Yes, an audit can sometimes result in a refund if the IRS finds that you overpaid your taxes. However, this outcome is less common.

The chances of being audited are relatively low, typically around 0.5% to 1% for individuals. High-income individuals, those with complex tax situations, or those in certain industries may face higher odds.