How to Survive an IRS Audit

Have you received a notice that your tax return is being audited by the IRS? Don't worry; it's not the end of the world. Here I will show you what you need to do to get through this process quickly and painlessly.

Difficulty: Moderate

Instructions

1. Don't panic. That is first and foremost if you get audited. If your return has been selected for a random audit, then that just means that the IRS computer has seen data that statistically indicates a higher mathematical probability of unsubstantiated deductions. As long as you can prove the deductions that you have taken, then you have nothing to worry about.

2. Even if you don't have proof or receipts for all of your deductions, the auditor may be willing to take your word for it if all of the numbers on your return are reasonable and you can prove at least some of your deductions. Just be sure to be polite and courteous to your auditor and have copies of all of your receipts handy.

3. Keep all original receipts and proofs of expenditures for your own files and give a set of copies to the auditor. Never give the IRS originals of anything except your W-2s and 1099 forms!

4. Bear in mind that you do not have to put up with an auditor who is rude, unreasonable or unwilling to discuss anything with you. Do not hesitate to call the IRS and ask for a supervisor and register a complaint if you feel that you are not being treated with courtesy and professionalism. In some cases, a new auditor may be assigned to your case.

5. Check your auditor's numbers to make sure that he or she does not make an error on your return (it is within your rights as a taxpayer). Most auditors are reasonable people, and if you can quickly produce documentation to validate the entries on your return, then your audit will be short and painless.

Tips & Warnings

• Dishonest taxpayers take note: lying in way to an auditor is a crime punishable by imprisonment. Provide false proof or information at your own risk!