Subscribe Feed (RSS)You’ve just received the one notification everyone dreads: the Internal Revenue Service (IRS) has decided to audit your tax returns. Don’t panic: 1.4 million Americans were audited in 2009 with an even greater number expected to be audited this year and beyond. The federal government is operating with a record debt and the government wants to make sure your contributions are sufficient.
Get Prepared
While you shouldn’t panic, you should be prepared to act decisively. That means reading your IRS audit notice carefully and following the instructions precisely. You will have thirty days to respond which is plenty of time for you to get organized. Likely, you are being audited for one tax year only which means you should do the following:
Pull out your tax records. Yes, the IRS is auditing taxes for 2005 which seems like ages ago. You do keep records going back for many years, right? That’s good, because you’ll want to examine your return for that year and check all of your receipts. If records are missing or lost, get new copies ASAP.
Examine everything closely. Be prepared to explain everything on your tax return line by line. Put yourself in the shoes of your IRS auditor: does every deduction pass scrutiny? You may not recall why you took $13,000 in charitable deductions that year, but you will soon need to show proof of same. In the Jan. 15, 2004 issue of “USA Today,” Thomas A. Fogarty warned that taxpayers sometimes wildly inflate the value of donated property. Hunt down receipts to prove everything including the property’s value at the time it was donated.
Seek professional guidance. If you have an especially complicated tax return being audited, then call upon the services of a tax accountant for assistance. Use the same person who completed your return to help you; she may need to join you when you are audited. But be warned: in the Feb. 10, 2002 issue of the “Los Angeles Times,” Liz Pulliam Weston noted that when it comes to bringing along someone for the audit, “only enrolled agents, certified public accountants and tax attorneys are allowed to handle such matters.”
Bring copies, please. Expect that whatever documents you bring with you to your audit may end up being lost or misplaced. In any case, make copies of everything and only bring those copies with you. At the same time you should not bring along extraneous information; you want to stay organized and demonstrate to the auditor that you have a firm grasp of your finances.
Be confident. Know your rights before meeting with the IRS, confidently outlining your case as well. But don’t be cocky; you’re being audited and you need to be prepared to answer the auditor’s questions. Simple “yes” or “no” answers will usually suffice; talk too much and you may raise the auditor’s suspicions that you are hiding something.
The End
If the auditor proposes changes to your return and you accept them, then the audit is over. You may owe additional taxes and penalties, but audits are officially concluded once both parties come to an agreement. If you want to appeal the IRS’ decision, there are certain procedures you should follow as outlined in the IRS article, “The IRS (Examination) Process.”
Tags: federal government, Internal Revenue Service, IRS, IRS audit, tax accountant, tax attorney, tax audit, tax return
The 
Should the U.S. Senate decide to pass a similar version of the bill, it’ll go on to the executive branch where President Obama has promised to sign it into law. Though it may take a few months before it kicks in, “Cash For Clunkers” could bring significant savings to the consumer who is planning to buy a new car. However, before that happens, there are a few things you should know about the program before you decide whether to participate or not.
Is Tax Relief Really The American Way?
May 4th, 2009 by Matthew C. Keegan | 2 Comments | Filed in CommentaryLook back over our nation’s history and you soon realize that taxation has always played a big role in how Americans define themselves. One of the reasons why the American colonies broke free from England was over the issue of taxation.
Tired About Taxes? Then Do Something!
These days, Americans often feel that they are being taxed to death all over again. No, the English have nothing to do with all of the anger being vented by taxpayers all across our nation. Rather, politicians in Washington, DC as well as in state capitals and even on the local level are creating much angst for tax weary citizens. Do you feel overtaxed? If you do, you can fight back which is the American way!
No, you don’t have to redo the Boston Tea Party to get the attention of elected officials. Dump something into a river today and the environmental police will jump all over you! On the other hand, you can signal loud and clear your displeasure to your politicians that “enough is enough” when it comes to taxes by taking the following steps:
Gather Signatures – Create a petition and have eligible voters sign the petition is one way that you can tell your elected officials that you demand they hold the line on taxes. In some areas of the country an online petition may be sufficient while in other areas you will have to go door to door for signatures. Expect to spend plenty of time recruiting volunteers and helpers!
Put it to Vote – In California, citizens are famous for voting on tax relief through propositions that mandate the government cap real estate taxes. If your state does not have such a method of seeking relief, you could pressure lawmakers to put forth a ballot initiative regardless. Learn what the requirements are to establish a local response.
Get out the Vote – What a sad state of affairs it is when getting half of the eligible voters out for an election is considered to be a good thing. Encourage everyone you know to vote with their feet by hitting the polling place on Election Day!
Run for Office – If you have a vision to hold taxes in line, then consider running for office yourself. Stay away from the special interest group — instead, form a true people’s voice movement to get the support that you need and the mandate necessary to help bring about real change.
Change Begins With You
Yes, tax relief can be done through the democratic process. Get involved and build a government wide tax relief model that will benefit citizens nationally. A movement starts with one person — will you be the one to get the tax relief engine started?
Adv.– Are you considering the purchase of a house or a car during this recession? For consumers who have good or excellent credit, this may be the best time to jump in to the market. You’ll also want to make sure that your emergency income levels are consistent during these times as well as have a good food storage plan in place to keep those costs under control too.
Tags: debt local government, federal government, money, state government, taxation, taxes