Tags: IRS | tips | tax | audit

WSJ: 6 Tips for Facing a Tax Audit

By    |   Tuesday, 18 Mar 2014 06:56 AM

As tax season heats up, one thing you don't want to have to worry about is an audit from the Internal Revenue Service.

But the audit rate has risen during the past five years for those earning $200,000 and up, The Wall Street Journal reports. So the paper offers six tips on how to handle an audit.

1. "Keep accurate records." This includes charitable deductions, dividend and capital gains payments and retirement payouts.

Editor’s Note:
Pastor Explains His Biblical Money Code for Investing


2. "Know what you are facing." You may receive a "math error" letter or a "correspondence audit." You usually must provide an additional payment or dispute the IRS complaint within 60 days.

3. "Don't panic." Definitely don't lie to the IRS, but don't immediately pay whatever it asks for, as it is often wrong, The Journal reports.

4. "Think twice before representing yourself." You generally want to have an experienced professional represent you if you're going through a formal audit. That can "save time, trouble and money," The Journal says.

5. "Never ignore an IRS letter." Respond to any letter the IRS sends you, even if you're just sending an additional copy of a letter you sent before.

6. "Don't forget your state." If it turns out you owe money to the IRS, you may owe money to your state too.

Bankrate.com offers six suggestions on how to handle an audit it too: "retain the services of a professional, keep good records, gather information, do your homework, behave professionally and realize that the IRS auditor is not your friend."

Editor’s Note: Pastor Explains His Biblical Money Code for Investing

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As tax season heats up, one thing you don't want to have to worry about is an audit from the Internal Revenue Service.
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2014-56-18
Tuesday, 18 Mar 2014 06:56 AM
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