Category: Taxes & IRS Audits

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.

Tax court is a whole new ball game. It is a brand new hearing before a judge who knows nothing about your case.

Here is how to prepare for the encounter with the IRS when being subjected to an office audit – Part 2