Facing an IRS audit is a stressful scenario to handle. However, with the right strategy — and a knowledgeable CPA — you’ll be able to navigate the proceedings with ease. To get started, use the following steps to help you organize your finances.

How to Handle the Proceedings of an IRS Audit

1. Prepare Your Response

The letter informing you of the audit should explain why the IRS needs to take a closer look at your finances. They’ll let you know whether you overlooked important earnings, made a mathematical mistake on your return, or were merely chosen randomly for an in-depth review.

Regardless of why the IRS needs to confirm your tax obligations, the first step is responding to their inquiry. Taxpayers have 30 days to fill out the requested forms and submit any supporting documentation. An experienced CPA can ensure you complete all forms accurately and thoroughly to prevent unnecessary delays. 

2. Gather Essential Documents 

Complying with an audit is much like filing a standard tax return; you’ll have to gather your financial documents of the year. Depending on the circumstances, the IRS might request mortgage statements, relevant receipts, pay stubs, brokerage statements, and prior tax returns.

The sooner you submit all requested documents, the sooner you’ll be able to put the entire audit behind you. Make sure not to supply the IRS with original documents. Keep those for yourself and submit only copies. 

3. Review Your Rights

It’s natural to be intimidated by the IRS, but remember that you have certain rights as a taxpayer. For example, you're entitled to challenge the IRS’s assumption that there were mistakes in your return.

You’re also entitled to file an appeal if you disagree with their final assessment after concluding the audit. Your CPA will explain these rights in detail and prevent the IRS from violating any of them. 

If you’re facing an IRS audit, turn to the CPAs at Erie & Associates, P.C. in Texarkana, TX. Since 1989, this firm has helped clients maintain their financial footing. When you turn to their team for IRS representation, you won't have to worry about corresponding with the auditors at all. They will handle the logistics on your behalf so you can focus on more important matters. To discuss your situation with a knowledgeable CPA, call (903) 792-6651 or reach out on their website.