Sam Brotman, JD, LLM, MBA September 30, 2013 4 min read

Going Solo: How to Represent Yourself in an IRS Audit - Part Two

Continued from Going Solo: How to Represent Yourself in an IRS Audit - Part One

IRS Audit Tip #4: Win More Flies with Honey than with Vinegar

It is difficult for many taxpayers to keep their emotions in check during an audit. Many are scared of the government examining their records, angry at the inconvenience of the audit, and some auditors can be very difficult to deal with. However, the best audit results are gained by working with the auditor collaboratively rather than butting heads with them. Auditors are people too and they will often cut breaks to those taxpayers that they like personally or who make their job easier by coming to the audit organized and prepared. With this in mind, be nice to your auditor and do everything you can to facilitate the audit process.

IRS Audit Tip #5: Pick Your Battles

I handle audits from a big picture perspective. It does not make sense to fight tooth and nail for a small deduction when it may lead the auditor to open up other years or risk jeopardizing your working relationship with the auditor. Also, conceding deductions in some areas or by only taking a certain percentage when you do not have sufficient receipts or substantiation may ultimately serve you well. Auditors tend to respond positively when taxpayers are reasonable and small concessions may lead the auditor to be more lenient in other areas. Try to keep yourself focused on the final goal, which is getting the smallest examination change possible.

IRS Audit Tip #6: When to Get Help

There is nothing wrong with the decision to represent yourself in an IRS audit, especially when you are organized and have nothing to hide. However, if your return is not entirely accurate, you failed to report income or overstated expenses, you did not keep very good receipts and records, or you feel you have reached an impasse with the auditor then it is a good idea to seek help. Since the ultimate goal is to have the smallest final bill or to obtain a “no-change,” hiring an attorney to represent you for a few thousand dollars has significant advantages. Attorneys often have a prior good working relationship with the IRS, have expert knowledge of IRS audit procedures, know the right time to elevate an issue to appeals, and can often move through the audit quicker than a taxpayer can alone. In addition, the attorney client privilege offers a greater level of protection than an accountant or enrolled agent and is especially important in cases where wrongdoing has or may have been committed. Because of the attorney client privilege, anything you say to an attorney will be held in confidence unlike any other representation. When in doubt, most attorneys offer free consultations and it is best to seek advice from a few sources before moving forward. Doing so can often save time, worry, and money when the audit is all said and done.

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Sam Brotman, JD, LLM, MBA

Owner and Director of Legal
Brotman Law

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