What Is A Tax Audit Service And What Are The Different Types Of IRS Audit?

Tax audit services involve an inspection of the tax return by the IRS to make sure that the income, as well as the deductions of an individual or a business is accurate. Usually, the tax return of an individual or a business is selected for review when something the entity has entered on his or her return is out of the normal. IRS audit can be classified into three broad categories, such as the office audit, the mail audit, and the field audit.

What is an office audit and what does it include?

Office audits are the physical inspections, which is conducted at a local office of the IRS. These inspections are usually more in detail than other types of audit. The audit usually includes questioning by the auditing official regarding the information on the return of an individual or a business. The entity or the business will be requested to bring exact information to an office audit. This includes the account ledgers as well as the documentation for the company or the individual's bank reports and receipts. The individual or the business will be permitted to bring a lawyer or an accountant, as well, to represent them at the IRS meetings.

What mail audits will usually include?

An individual or a business will get a mail notification about the IRS audit, irrespective of the type of the IRS audit. This means that the individual or the representative of the business will be exempted from appearing physically in the IRS office.

Usually, the IRS will demand supplementary documents to validate different items the individual or the business report on their tax return. For instance, if you have donated $10,000 to a charitable organization, and if you claimed that amount, then the IRS will ask you through the mail to produce the receipt or any other proof for the amount you donated. If IRS is satisfied with your proof, the mail audit will be concluded.

What is known as a field audit?

The field audit is the most expansive category of an inspection conducted by the IRS. In this type of audit, a representative of IRS will carry out the inspection at your business if you are running a business or at your home if you are an individual taxpayer. Usually, a field audit involves questions about your deductions. It is the most systematic type of audit, as it will cover all types of deductions that you have claimed on your tax return.

What outcomes can you expect from the IRS audit?

You can expect three types of outcomes from the IRS audit. These outcomes include:

1. Your tax return will remain unchanged if IRS is contented with your documentation and explanations that you offer.

2. If the IRS suggests alterations in your tax return, you can either concur and admit the changes or challenge the evaluation of the IRS agent. If you concur, you may need to sign an inspection report. Then you have to arrange for the payment. If you oppose the findings, you have the right to set up a meeting with an IRS executive to evaluate your case further.

3. If the IRS still asks you to make the payment, you have to opt for the tax collection defense. It is a process, which allows you to pay your tax liabilities in installments

When you file your tax return through an experienced and reliable firm, such as Tax Defense LA, you can get a professional service at an affordable price, besides resolving your tax problems in an amicable way.

About the Author:

The author of this article has an extensive knowledge in the field of Tax Collection Defense and Tax Audit Services.