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For many in Missouri and across the country, filing taxes is a time-consuming task that is filled with complications. Often, there is a concern that a simple mistake will lead to an audit and, potentially, criminal charges. For many, the risk of audits is daunting, and many people who must undergo them are unfamiliar with the process.
An audit is a formal examination of tax returns conducted by the IRS to uncover inaccurate information or discover fraud. An audit can occur as a result of a random or intentional selection. A random audit is typically a simple matter of taking a closer look at a filing. A person will receive a letter in the mail, indicating the IRA’s intent to conduct an audit.
There are four types of audits. The least serious is a correspondence audit in which the IRS requests additional information to help determine the veracity of information provided. In a random audit — as mentioned above — an IRS auditor will review a filing in its entirety to determine whether the information was entered accurately. The third type is an office audit, in which an in-person interview occurs. The most serious type is the field audit; an IRS auditor will visit the person’s home or business.
Information provided to a tax auditor can ultimately be used against the person in court. As a result, many people in Missouri facing such audits often choose to seek guidance from an attorney with experience with the process. Such a professional can help analyze the status of the return and create a plan to resolve any issues.
Source: FindLaw, “What Is a Tax Audit?“, Accessed on May 10, 2018