| As you've probably notice, the federal government has | | | | taxpayers underreporting income and claiming |
| been spending money like it grows on trees. Whatever | | | | excessive tax deductions. The only real way to go |
| your political views, two wars and a failing finance | | | | about correcting this is to conduct audits. |
| industry cost a lot of money to deal with. Well, it just | | | | Does the IRS conduct brutal audits of taxpayers? Yes, |
| so happens that IRS audit rates are up. Could they be | | | | but this is fairly rare. The most common audit by far is |
| related? | | | | the correspondence audit. The IRS will send you a |
| Drive over to the baddest biker bar in your town. Go in | | | | letter questioning something on your return or claiming |
| and find the meanest looking guy. You know, the one | | | | you owe more money. You can then either challenge |
| with tattoos, the ZZ Top beard and the general bad | | | | the claim with supporting documents or send in a |
| attitude. Now tell him that the IRS is auditing him. His | | | | check. If you have ever had such a situation in the |
| reaction? | | | | past, you've technically been audited. Congratulations. |
| It is sad to see a grown man cry. | | | | Of course, the IRS can conduct more extensive audits. |
| Next to death, it is really hard to think of something that | | | | There are two types. One occurs when the IRS tells |
| scares people more than being audited by the IRS. | | | | you to bring documents in to their office to support |
| The horror stories are circulated over and over like | | | | some claim on your tax return. The second is when |
| some bad horror movie. From a three hour audit, they | | | | the IRS shows up unannounced at your place of |
| slowly grow into a 30 year nightmare with physical | | | | business and demands to see your records then and |
| beatings as the story is exaggerated a bit more each | | | | there. |
| time it is told. The IRS does nothing to rebut these | | | | Either of these audits should be taken seriously by you. |
| since a scared taxpayer is one who is more likely to | | | | Fortunately, you do not have to speak with the IRS |
| pay. | | | | agents. Instead, immediately hire a CPA or tax lawyer |
| What is not a myth these days is the fact the IRS is | | | | to do that. This will keep the IRS from bullying you and |
| conducting more audits than it has in a long time. The | | | | getting access to information it has no right to see. |
| primary reason is a reported $300 billion gap between | | | | IRS audit rates are up, so make sure to prepare |
| what should be paid by taxpayers as a whole and | | | | yourself to deal with one should you get a notice in the |
| what actually comes in. The tax gap is attributed to | | | | mail or, god forbid, an agent at your door. |