How Much Information Should You Give the IRS?

“More is better than less because if stuff is not less, if there’s more less stuff, then you might, you might want to have some more. And, your parents just don’t let you because there’s only a little bit. We want more. We want more. Like, you really like it, you want more.”

I love that commercial. It reminds me of the IRS. They always want more – information, that it

Just because you receive a notice from the IRS that your income tax return has been selected for audit, doesn’t mean that they are out to get you. It could just mean that they need more information.

There are three main types of audits conducted by the Internal Revenue Service.

  1. The simplest is the correspondence audit. You will get a letter from the IRS requesting that additional information be mailed to them or that a proposed additional amount of tax be sent in.
  2. The second level of audit is the office audit. You will be asked to bring certain information to the meeting. It is best to consult your tax advisor in order to be better prepared for this meeting. If possible, set the meeting place at your tax advisor’s office.
  3. The most complete audit is the field audit. They are conducted at your home or place of business. It is best to avoid these if possible. Once the agent is at your place, he or she has much more to see and ask about.

Whatever type of audit you’re selected for, be aware that the IRS always want more. Keeping that in mind, here are some basic do’s and don’ts for an audit:

  • Be organized.
  • Provide only the documents needed to support the deduction being questioned.
  • Never give the IRS agent more or less information than is requested.
  • Don’t chatter or exchange casual conversation. Each comment only gives them more information.
  • Insist on getting copies of the information in their files or copies of anything that you sign.
  • Better yet, wait until your representative has time to review the document before you sign it.

IRS Audit Assistance

There’s nothing that you can do to make audits more fun, but there are steps that you can take to make them less scary. If you receive an IRS notice, contact Rea & Associates. Our Ohio tax professionals will assist you with an IRS audit.

Note: This content is accurate as of the date published above and is subject to change. Please seek professional advice before acting on any matter contained in this article.