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In this article, we have collected the 20 most commonly asked questions about tax audits and briefly answered them for your reading pleasure. Explore our tax content to find in-depth information about each question. Frequently Asked Questions Our website is filled with an in-depth discussion regarding specific dealings with the IRS. Sometimes, all one needs […]

The IRS is powerful, but not without limit. After getting over the shock of reading “we have selected your federal income tax return for examination,” look carefully at the year or years on the audit notice. In general, after you file a tax return, the IRS has only three years to begin and end an audit of […]

Some field audits last a couple of hours and are wrapped up that day. In extreme cases, a revenue agent may spend hundreds of hours over a year or two conducting a field audit. The typical field audit, however, involves an interview with the revenue agent that lasts an hour or two, followed by the […]

IRS appeals rules differ, depending on the amount of taxes you are disputing from an audit. It’s important to know at which thresholds the IRS separates requests. Smaller cases allow for a less formal appeal request while larger cases require more in-depth communication. Below, you’ll find an overview of these two case determinations and how […]

If you want to contest in tax court an audit outcome of over $50,000 for any one year, your case will be considered a regular case. Most people hire a tax pro to represent them when arguing a regular case. A Trial in Tax Court If your case reaches the trial stage, the judge may […]

Here’s one way to minimize the expansion of your audit: Don’t file a tax return while an office (read here) or field (read here) audit is in progress. This rule does not apply if the IRS is conducting a correspondence audit (read here). If you file your return during an office or field audit, the […]

Money magazine estimates that between 25% and 50% of automated adjustment notices are erroneous. A common IRS mistake is not finding an income item that was reported elsewhere on the tax return. This can result in incorrectly misreported income, as illustrated below: EXAMPLE: Hilary reported $457 of money market fund income as interest. The financial institution […]

Some appeals officers sit back and wait for you to present your case, while others run the show by asking questions.