4 Types of IRS Audits: What to Know and How to Prepare for Each One

Fox News ^ | 06/17/2013 | by Donna Fuscaldo

[SeekAndFind]

Being the subject of an IRS audit is enough to make anyone sweat, but knowing your rights and the type of audit your facing can help make the process a little less stressful and drawn out.

“There’s a lot of fear when you find out you’re getting audited,” says Mary Kay Foss, a certified public accountant. She suggests contacting a professional immediately after receiving the audit notice. “If you ignore it, it’s not going to go away.”

There are four types of IRS audits and you will prepare differently for each one:

1) Correspondence Audit: This is the least severe type of audit, according to Rocket Lawyer On Call attorney Mark Rosenberg and involves the IRS sending a letter in the mail requesting more information about part of a tax return.

For instance, the agency may have questions regarding charitable deductions and request you send in receipts to substantiate your deduction. “It’s the lowest level of the audits,” says Rosenberg. “If you have the receipts or information it’s generally not an issue.”

If your tax return is legitimate and you have the data to back up any claims on your return, tax professionals say you can normally handle the situation on your own. If you don’t have the receipts or information, then you may want a professional dealing with the IRS because you could face fines, penalties and interest if you end up owing money.

“If it’s small and not that much income, the audit is often done through the mail,” says Bill Smith, managing director of accounting firm CBIZ MHM.

2) Office Audit: If the IRS has more questions about your return, then you’ll get a letter in the mail inviting you into an IRS office for the audit.

[jurroppi1]

unfortunately that is a bit of a trip from MN. Thanks anyhow :)

[Cvengr]

My younger brother ran for Congress last year in the Tea Party, and made a respectable showing in the Primary, but the Republican incumbent had 51% of the vote to my brother’s 42%, so his campaign stopped there.

I was then audited that same year. I didn’t attribute it to his politics, but this year I received a notice dated 22Dec2014, to contact their office within 10 days for an audit and to provide them with copies of my 2014 returns.

Strikes me as a little strange to demand your tax return before the tax year has completed.

[woodbutcher1963]

That does seem strange to be audited prior to submitting a return. Are you self employed or do you get a W2 from your employer?
Did you have any large capital gains or something that would put a red flag on your SS#?
I would hire a CPA unless you already have one and ask them to submit your return for you. That way you have someone that has gone through an audit before. I think the IRS is less likely to try and push around a CPA. A CPA may also have some insight as to why they would audit you? Have them contact the IRS and ask the reason for the audit. It could be just a random selection.