Don't Go to that Audit

The bad news from the IRS is that there will be more tax audits this year, especially for higher-income, self-employed taxpayers, a description that fits many physicians. Here's a tip if the IRS calls you for an

“The difference between death and taxes is death doesn't get worse every time Congress meets.”—Will Rogers

The bad news from the IRS is that there will be more tax audits this year, especially for higher-income, self-employed taxpayers, a description that fits many physicians. Here’s a tip if the IRS calls you for an audit: don’t go. Many tax experts advise you not to show up at a face-to-face audit with an IRS agent. Have your CPA, your lawyer, or the enrolled agent who did your tax return go in your place. (An enrolled agent is a person who’s passed an IRS tax preparation exam),

Here’s why: not being at the hearing may actually get you better results. Since most audits are actually negotiations, your chosen representative can be less emotional about your finances than you would be if you were in the hot seat. He/she is also less likely to give away information that might result in more intensive IRS digging. Tip: It also helps if you didn’t cheat on your return. Tax evasion is a crime; tax avoidance, even if you use some aggressive strategies, is not.

25%Percentage increase in IRS audits of partnerships and S corps last year.(Smartmoney.com, 2008)Read More:

Tax Audit Tips: Avoidance and Preparation

Tax Audit Flags for Small Business