The IRS will mail an official notice requesting specific answers and documents to support a triggering detail within your filed return. Examples include income, deductions, or a tax credit.

When your response is requested, the most important things to do are:

  • Respond to the IRS with all evidence by the specified deadline.
  • Remain actively involved with the process, including any filed appeals or disputes.

When exchanging documents with the IRS, be sure to include an explanation of how each item supports your filed return. When information can’t be located, providing a thorough explanation via “oral testimony” could be the next step to take.

If you disagree with the IRS decision on your return, including any proposed penalties, you may be able to file an appeal with the IRS .

What’s the Deal With Deadlines?

We cannot emphasize enough the need to respond to all requests for information from the IRS. Appeals must also be filed according to the deadline established by the IRS. If you miss these important deadlines, the IRS can charge you taxes. Or worse, you could possibly lose your right to appeal.

Filing for an extension is a great option for those who find themselves unable to provide all documentation before the IRS deadline. This option is a protective measure to offset additional taxes and penalties that you could be charged.

If you’ve already missed the deadline and you have been charged additional taxes, you can request audit reconsideration from the IRS.

What Is the Face-to-Face Audit Process?

Audits that occur within an IRS office are called the office audit or desk audit. Office auditors, called tax examiners , focus on specific items on the questionable tax return. When the IRS conducts an audit at the taxpayer’s home or place of business, it’s called a field audit.

Revenue agents review all business types in the field including high net-worth taxpayers with complicated returns. Examples include employer returns, estates, trusts, and international filings.

Office and field audits are a mystery to many. Most taxpayers and tax preparers haven’t experienced this type of IRS enforcement action. If you are subject to a face-to-face audit, there are four basic phases to expect:

  1. Audit notification and preparation: The IRS notifies you (or your authorized tax pro) about the audit, almost always by mail. Usually, the audit will be for a return that you filed within the past two years. The IRS will send a request for information (Form 4564, called an information document request, or IDR). The IDR will most likely show you what the IRS is interested in auditing. But don’t let this fool you; office and field audits involve more than one year and often expand to other issues.
  2. Initial interview: The office audit process takes about two hours. For field audits, this process can take up to a full day, depending on the complexity of the taxpayer and the tax return. During this time, you will give the auditor the big picture of your circumstances, your business, the year under examination, and the items requested by the auditor.
  3. Issue development: Inevitably, the IRS will focus on a few items – and will ask a lot of questions about your return, finances, and more. There may be more IDRs and even requests for interviews. In this stage, you must advocate for yourself and provide explanations to the auditor. If the auditor proposes an adjustment to the return and/or penalties, you will need to decide to agree or start preparing your appeal.
  4. Finalizing the audit and appealing the decision, if necessary: If the appeals process is your next step, an impartial person in the IRS Office of Appeals will consider your petition at an appeals hearing. This hearing is held months after the audit has ended and will likely take place by phone. If you prefer, you can request a face-to-face meeting with the appeals officer. If you disagree with the decision, you could eventually take your case to the U.S. Tax Court

What Should I Do Next?

To avoid the stress and negative possibilities of face-to-face audits, many taxpayers leave field audits, and even office audits, to experienced tax professionals who can navigate the process and deal with the IRS for them.

At Nugent & Associates, we're not just number crunchers. We bring over 3 decades of invaluable certified public accounting and tax expertise to your company – serving as business and financial strategists who can offer such services as tax and financial planning, investment advice, diligent financial records, and help with estate planning.

Even better, we will give you time to focus on what you do best: running the day-to-day operations that drive your business toward success.

Take advantage of our FREE and no obligation business checkup.

We will visit you at your business at a time and day convenient for you, analyze your numbers, discuss your goals and concerns and report back with a complimentary detailed written analysis to help your business succeed!

At Nugent & Associates, we're not just number crunchers. Our people bring decades of invaluable certified public accounting and financial and tax expertise to you – offering tax and financial strategies to individuals such as yourself. If you have any questions or concerns about your own tax, financial or investment matters, please do not hesitate to contact us.

Experienced tax and financial experts are not just for the super rich. At a reasonable fee you too can maximize your wealth and receive professional guidance for retirement, and/or any tax issues you may be facing, no matter your situation, with a tax and financial expert as your consultant.

Contact Nugent & Associates today. We don't charge for phone calls. You may just find you found an ally in your quest to have a great financial future.

After all, at Nugent & Associates, we succeed when you succeed!



This page is intended to be informational. This website, nor any of the information contained on this site constitutes professional, business, tax or legal advice and is not a substitute for such advice nor does it create a professional-client relationship between you and Nugent & Associates.

State and federal laws change frequently, and the information in this page may not reflect your own state’s laws or the most recent changes to the law.

The information contained within this website should not be considered as a solicitation or an offer for a professional-client relationship. Materials contained in this website are of a general nature and should not be substituted for professional advice. Nugent & Associates is providing this website and the information contained herein only as a convenience to you. Nugent & Associates assumes no liability or responsibility for any errors or omissions contained within this website. There is no guarantee that the information included on this site is current, accurate, complete, useful, or reliable.

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