Did You Get an Audit Notice from IRS

Did You Get an Audit Notice from IRS

Did You Receive a Notice of Audit from IRS: When a Taxpayer receives a Notice of Audit from the Internal Revenue Service, it is oftentimes nowhere near as bad as some fearmonger attorneys want to make it sound. Throughout your lifetime, you will have various obstacles and challenges to face — and merely receiving a notice of audit from the IRS, letting you know that either your taxes may not be correct; something is missing from your tax return, or the IRS  wants some clarification on a specific issue — does not rank up there with the big challenges you will face during your lifetime. Of course, when you get a notice of audit from the IRS, it can be unsettling — especially because it will probably arrive via certified mail, now making it seem all the more serious. When you do receive a notice of audit come it is important to respond timely. We have summarized a few important tips below about how to respond when receiving an audit notice.

*If you receive a notice from the IRS Special Agents, then that is serious (since it has criminal implications) and you will definitely want to speak with a tax specialist attorney. 

What is the CP Notice Type You Received?

When a person receives a CP notice from the Internal Revenue Service, CP stands for “Computer Paragraph” — and there are many different types of CP notices. Oftentimes, Taxpayers are confused when they receive a “CP” notice, because they presume all notices are audit letters — but that is not the case. Therefore, it is important to be sure that the notice you received is actually an audit notice and not some other type of correspondence from the IRS.

What is the Audit Notice Asking For?

Not all audit notices are the same. Some IRS audit notices focus on very specific issues such as cryptocurrency or Puerto Rico Tax Incentives Code 60 (prior Acts 20/22). Other audit notices are much more general and may have one or more specific issues that the IRS requires clarification or supplemental information concerning — and it may be for one or several years. Therefore, it is important to get a baseline understanding of what the IRS notice is even asking for.

What Type of Response to an Audit Notice is Required?

Depending on the audit notice type and what type of information the Internal Revenue is seeking from the Taxpayer  it may require the taxpayer to reach out and contact the examiner to schedule the audit and/or may request certain information or documentation to be provided for by the taxpayer (this is usually referred to as an IDR or Information Document Request). Before just reaching out and contacting the Internal Revenue Service, the Taxpayer should evaluate the notice to see what the IRS is seeking by way of information.

How Much Time to Respond to the IRS Audit Notice?

One important part of any IRS Audit Notice is determining what the time-period is for response. Typically, the Taxpayer will have anywhere from 10 to 30 days to respond to the audit notice — and therefore the Taxpayer should be sure to calendar that date, so that they don’t miss the response date. Typically, missing the first response date is not fatal — 

Contact a Board-Certified Tax Law Specialist

It is important that Taxpayers speak with an attorney before reaching out to the Internal Revenue Service — because only with an attorney does the Taxpayer receive the Attorney-Client Privilege. Unfortunately, with the rise of the internet comes various self-proclaimed expert attorneys and marketing ploys and scams which tend to prey on Taxpayers’ fears and is referred to as fear-mongering or scare-mongering. The best way to ensure that you have at least spoken with a qualified tax professional is to find a Board-Certified Specialist Tax Attorney that focuses on your specific area of audit (such as cryptocurrency, international tax, real estate com etc.) and get a better understanding of how you may respond to the IRS. If it is not cost-effective for the Taxpayer to speak with an attorney, they may want to consider speaking with another type of tax professional in order to at least better understand how to respond to the audit notice.

Our International Tax Lawyers Represent Clients Worldwide

Golding & Golding specializes exclusively in international tax, and specifically IRS offshore disclosure for prior year noncompliance.

Contact our firm for assistance.