IRS Audits and Appeals
If you’ve just received a notice from the IRS that you’re being audited, take proactive steps to ensure that any tax issues raised in the audit are resolved favorably. How you deal with the audit for one tax year determines whether or not you incur increased tax liability, heavy penalties and interest, and audits for other tax years as well. If the IRS receives erroneous or insufficient documentation, you should expect Uncle Sam to keep in touch with you for an extended – and uncomfortable – period of time.
The IRS routinely conducts audits on tax returns, both business and personal, for any number of reasons. Generally, an IRS audit covers select areas on the return. For businesses, a common focus is travel, meal, and entertainment expenses and depreciable assets. For individuals, a common focus is expenses for rental properties, foreign tax credits, charitable deductions, and medical expenses. If the IRS auditor determines that you have made an error for one year, the auditor will examine all other years allowable by law and open up the entire tax return. And the cycle of the IRS audit becomes seemingly endless while your tax deficiency continues to increase.
During an IRS audit, we focus our attention on the major battles. For example, if you inappropriately deducted the expenses of a vacation home as a 100% business deduction, we will not waste your money in fees or the IRS auditor’s time by fighting for a deduction which is not allowable. You may lose some of the minor battles, but that doesn’t mean that you lose the war.
This strategy lets the IRS auditor know that we will fight them all the way to court if necessary. We determine quickly if the issue cannot be resolved at the audit stage, and we will pursue a fair arrangement for you through the Appeals process. Your odds of winning an appeal greatly increase when you are defended by a dedicated team thoroughly versed in tax laws.
Contacting Law Offices of Christy Lee, P.C., when you first receive an IRS notice of audit will increase the chance of a favorable outcome for you.
Why? The IRS knows that a tax attorney meets deadlines and provides professional and correct information concerning your tax returns. And that fact goes a long way to establishing the kind of rapport necessary to keep the IRS focused on the year in question rather than expanding the audit to include many other years.
The major reason for audits, of course, is that Uncle Sam wants to collect all unpaid taxes due the government, and to do that, the IRS has to make sure that taxpayers report all income and profits and do not take any unallowable deductions. IRS agents must act aggressively, using the full array of techniques available under their extensive authority. This policy puts the average taxpayer, who has neither unlimited resources nor unlimited time, at an immediate disadvantage.
While we at the Law Offices of Christy Lee, P. C., believe that it can be a legitimate government activity (after all, who really wants to live with infrastructure and educational practices harking back to the Dark Ages?), we also understand that tax collection often involves intimidation, extremely high interest, and heavy penalties. The IRS can place liens on your real property, levy your bank accounts and other personal property, and garnish your wages. In general, the IRS holds the license to freeze all your assets, turning day-to-day routine business transactions into intolerable tasks. These harsh IRS tactics are designed to ensure compliance without question, particularly from the taxpayers who may not be fully aware of all their legal options.
You have the right to legal counsel regarding your tax issues. As a tax boutique, we offer a wide range of measures, both offensive and defensive, that optimize the prospect of a positive outcome for you if the IRS does choose to audit your tax return.
If you have been tagged for an audit, or if you have reached the state of appeals concerning your taxes, call our tax boutique. Law Offices of Christy Lee, P.C., can alleviate your anxiety, stand between you and the IRS, and negotiate on your behalf so you don’t have to.