What Are the Risks in an IRS Audit?

What Are the Risks an IRS Audit? Well there's plenty of risk when the IRS audits you return it let's start with the presumption that the IRS didn't audit your return by accident. The auditors there because they're clearly looking for something that the IRS has questions on and they believe we yield additional tax the auditor is not just going through the exercise of doing the audit just because the auditor is looking for mistakes and looking for errors anytime the government examines a return that you signed under penalty of perjury there is a level of risk if the auditor finds mistakes or if they don't believe that your documentation is properly substantiated on the return then not only they assess you tax but they'll assess you additional penalties and interest in addition auditor is often engaged in what we call fishing expeditions which is when they start examining the return line by line in terms of looking for more and more errors an auditor that finds errors on a return is more likely to dig and dig and dig and dig until they're satisfied that they found all the errors that could possibly exist on the return this process is a nightmare for the taxpayer not only as a taxpayer forced to provide all the documentation connected with any anything related to the return but it also usually yields an a high adjustment for the taxpayer so enter the audit but the following in mind anytime your return is selected by examination for the government whether it's a routine correspondence on it or a field audit which is much more severe you are at risk there are varying degrees of risk but a government investigation is never a safe bet your best to protect yourself your best to get a thorough analysis the risk and you're better to appropriately deal with the issue than to get a caught off-guard by the IRS auditor.


Sam Brotman, JD, LLM, MBA

Owner and Director of Legal
Brotman Law