Fun fact: Our CEO and founder, John Milikowsky, has done both! Let’s see what he thinks.
IRS audits – No kidding, they’re not fun, no matter who it is. John notes “When I helped relatives through them, the pain isn’t the auditor being mean; it’s the infinite information they need. They start with six items and then ask for everything. Bank statements, receipts, every number’s substantiation becomes crucial. And if your records aren’t perfect, recreating numbers two years later during an audit is a challenge.”
No one has flawless records; even big hotels or manufacturers struggle.
The Similarity? Imperfections!
Like skydiving becoming less scary over time, IRS audits become more of an annoyance. However, they’re both about navigating imperfections. Audits are about recreating numbers, while skydiving relies on instincts and experience. In both cases, you have to trust your preparation.
The Lesson? Preparation is Key
But here’s the thing. Skydiving is a choice, but facing an IRS audit isn’t. It’s your responsibility as a taxpayer to report honestly. Keeping good records isn’t just smart; it’s your shield against these audits. As a US citizen or anyone earning in the US, honesty in your returns and maintaining accurate records is crucial.
How to Prepare for an Audit
An audit goes as well as you prepare for it. To prepare for an audit, consider the following steps:
Gather all the necessary documents: Make sure you have all the necessary documents listed above. If you don’t have a particular document, try to obtain it as soon as possible.
Organize your records: Make sure your records are organized and easily accessible. This will make it easier for you to locate the information the auditor needs.
Review your tax return: Before the audit, review your tax return to make sure that all the information is correct and that you have documentation to support the information.
Seek professional help: If you are unsure about how to prepare for an audit or if you need help with your records, consider seeking the help of a professional tax preparer or accountant.
Be honest: During the audit, be honest and straightforward with the auditor. If you made a mistake, admit it and provide any necessary documentation to support the correction.
An IRS audit can be a stressful experience, but by being prepared and having all the necessary information and documents on hand, you can reduce your stress and increase your chances of a successful outcome.
At Milikowsky Tax Law, we have over a decade of experience working with IRS and tax audits. We’re experts in defending business owners in the face of IRS or other government agency audits.
Interested in learning more? Read on to learn how to respond to an IRS audit.
The Road to a Successful Audit
While an IRS audit may induce stress, thorough preparation and having all necessary information at hand can significantly ease the process and increase the chances of a favorable outcome.
At Milikowsky Tax Law, our extensive experience in navigating IRS and tax audits empowers us to expertly defend business owners in the face of these challenges.
For deeper insights on how to respond to an IRS audit, delve into our detailed resources. Our team is here to guide and assist you every step of the way.