Introduction: The Internal Revenue Service (IRS) conducts audits on individuals and businesses to ensure that they are paying the correct amount of taxes. The process can be intimidating, and the consequences of a failed audit can be severe. This is where a tax audit lawyer can be of help. A tax audit lawyer is a legal professional who specializes in tax law and represents clients during IRS audits. In this blog post, we’ll discuss the importance of hiring a tax audit lawyer and everything you need to know about the process.
Reasons for a Tax Audit
There are several reasons why the IRS may conduct a tax audit. Some of the most common triggering events include:
- Discrepancies in Tax Returns: If there are inconsistencies or errors in your tax returns, the IRS may decide to audit you. This could be due to an honest mistake, such as a typo or a miscalculation, or it could be intentional tax evasion.
- High Income: If you have a high income, you are more likely to be audited. The IRS often targets high-income individuals because they have more complex tax situations.
Consequences of an Audit
The consequences of a failed audit can be severe, including penalties, fines, and even criminal charges. Some of the potential consequences of an audit include:
- Penalties and Fines: If the IRS finds that you have underpaid your taxes, you may be subject to penalties and fines. These can add up quickly, making it difficult to pay your tax bill.
- Increased Scrutiny: If you have significant discrepancies or proposed tax adjustments as a result of the audit, the IRS may increase its scrutiny of your prior and future tax returns. This means that you may be more likely to be audited again in the future.
- Criminal Charges: In some cases, the IRS may pursue criminal charges for filing a fraudulent tax return or even tax evasion. This can result in fines, jail time, and a criminal record
What a Tax Audit Lawyer Does
A tax audit lawyer can be of great help during the audit process. Some of the things that a tax audit lawyer can do include:
- Provide Legal Advice: A tax audit lawyer can help you understand your legal rights and obligations during the audit process. They can also provide advice on how to respond to IRS requests for information and documentation.
- Represent Clients During the Audit Process: A tax audit lawyer can represent you during the audit process, attending meetings with the IRS auditor and responding to requests for information on your behalf so you do not have to meet with the auditor directly.
- Administrative Appeal: If the IRS proposes adjustments you disagree with, a tax audit lawyer can file an administrative appeal and/or represent you in tax court to dispute the IRS proposed assessment.
- Negotiate Settlements: If the audit results in a tax bill that you cannot afford to pay, a tax audit lawyer can negotiate a settlement with the IRS on your behalf.
Choosing a Tax Audit Lawyer
If you are facing an IRS audit, it is important to choose the right tax audit lawyer. Some of the things to consider when choosing a tax audit lawyer include:
- Qualities to Look for: Look for a tax audit lawyer who has experience representing clients in audits, a deep understanding of tax laws and regulations, and excellent communication and negotiation skills. Tax audits require accounting and tax return preparation skills. Having a tax audit lawyer who is also a CPA or has tax accountants on staff can be a valuable advantage.
- Questions to Ask: Before hiring a tax audit lawyer, ask about their experience handling similar cases, their success rate in negotiating settlements, and their fee structure.
- Cost Considerations: The cost of hiring a tax audit lawyer can vary depending on the complexity of the case and the lawyer’s experience. Make sure you understand the fee structure before hiring a lawyer.
Benefits of Hiring a Tax Audit Lawyer
There are several benefits to hiring a tax audit lawyer, including:
- Legal Expertise: A tax audit lawyer has a deep understanding of tax laws and regulations, which can be invaluable during the audit process. They can help you understand your legal rights and obligations, and they can help you navigate the complex tax code.
- Peace of Mind: Dealing with an IRS audit can be stressful and overwhelming. Hiring a tax audit lawyer can give you peace of mind, knowing that you have a legal professional on your side who is fighting for your best interests.
- Lower Risk of Penalties: A tax audit lawyer may be able to help you avoid penalties and fines by ensuring that your tax returns are accurate and complete. If you owe taxes as a result of your audit, they can assist in determining what resolution options will be available to you, such as an installment agreement or Offer in Compromise.
Facing an IRS audit lawyer can be a daunting experience, but hiring a tax audit lawyer can make the process much less stressful. A tax audit lawyer can provide legal advice, represent you during the audit process, and assist in resolving taxes owed to the IRS on your behalf. When choosing a tax audit lawyer, look for someone with experience handling similar cases, a deep understanding of tax laws and regulations, and excellent communication and negotiation skills. Hiring a tax audit lawyer can give you peace of mind and provide you with the tools and knowledge necessary to avoid future tax compliance issues.
When it comes to tax audits, having a lawyer who is also a CPA or has tax accountants on staff can give you a major advantage. Our multidisciplinary team at Rosefelt Tax Law has the accounting and tax preparation skills you need to navigate an audit successfully. If you’ve received an IRS Audit notice, call us today at (888) 962-5752 for immediate assistance. Don’t take any chances with your financial future – trust us to help you get through your tax audit with confidence!