IRS audits are going to increase tremendously this year. They will also increase in the future. The IRS will specifically be targeting small business owners and high-income individuals and professionals. If you are a small business owner and operate as a sole practitioner, or as an S corporation, you will probably be audited. Small business owners who operate as C corporations are less likely to be audited. Most IRS agents do not like to work hard. It is very easy to beat the IRS at the audit game. You need to have good records and an accountant who has lots of experience fighting audits. I suggest using a former IRS agent who was with the IRS for at least 20 years. Even though most IRS agents tend not to be hard workers, 20 years gives him enough experience to know the ways of the IRS. A lot of my friends still work for the IRS and I always hear good stories about audits.
Beware of someone whose fee is based on a percentage of how much you save in taxes. Or who promises to get you a significantly higher refund than anyone else can. People like these are likely to prepare outrageous returns that will land you deep in trouble with the IRS.
Just because the IRS says you owe money doesn’t mean that’s correct. The agency makes mistakes – plenty of them, even computing penalties and interest.
Having a smart, well-prepared tax expert on your side can be a tremendous advantage. Not only will they know the ins and outs of the tax code, but also they can take over the often-exhausting job of dealing with the IRS – and help you decide how far to push the fight.
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