Who's been audited before?

[kandaandm]

So I checked my mail and I got a wonderful suprise. The IRS says they chose me to get audited. ShiAAAAAAAAAAAAt....I'm signing over power of attorney to my accountant and he is going to handle it for me, but hell.....who has gone through this before? I don't know what to expect...

 

[VNV]

Shit man, real bummer. Did you do anything unusual, like report a huge loss on a small business, or deduct a whole bunch of stuff and get a $5K+ refund?

 

[kandaandm]

I screwed up and didn't keep receipts.....but I only deducted what my accountant told me to deduct.

 

[cjjrwe]

The IRS does random auditing, which is a small percentage. The usual audit involves returns that they flag for certain deductions, e.g. certain business expenses, etc., on top of that, they usually only audit returns they expect to see revenue from. This does not mean you are screwed, of course record keeping is key, however if your accountant is on it, you should be fine. This shit happens...BTW, there are a few types of audits, e.g. correspondence, they call you in, they come to you, each has it's own pros and cons.

 

[thebrick]

Never been audited but if you are self-employed there are certain reds flags that will put you on their radar. One being if you claim income that is less than your client's 1099's say what they paid you. A friend of mine was audited and she was fine but it cost her a couple $K in accountant fees.

 

[Pekkerwood]

I have been audited multiple times. The fear is much worse than the actual event itself. Even when you forgot or lost receipts they can still look at "Standard and Normal" deductions for you business class.

You are already doing my number one tip: Do not meet them in person, hire someone to do it for you and let the professionals work it out.

Additional tip: If the person you hire is a past regional director of the IRS is helps a lot.

 

[e6er]

This was my first year I could claim biz expenses. Guess what, I didn't bother. I was only getting back $800 and the chance of getting audited wasn't worth it, especially since I've claimed other things I did not have a receipt for.

 

[King-kong]

F'em, They are only going to get what was supposed to be paid anyway. Call any friends in the same industry and get all the receipts you can. Yours, his, hers, etc. If you had any stock losses in the past years that were not liquidated - such as worldcom, enron, etc that just went friggin belly up - you may have claims there.
The more taxes you pay the more we are able to support those on welfare, ss disability, etc. that are more than fkn capable of working. Of course we make it easier for them to stay home. Sorry - getting off the subject here. Dont worry just prepare yourself and tell them you did make some mistakes - there were some more write offs you forgot to include. Good luck.

 

[kandaandm]

Thanks for the responses...you guys helped calm me down a bit.

 

[gringo220]

From what I heard you have a less chance of getting audited if you send your taxes in at the last minute. They are flooded with them and don't have time to mess with it all. Usually it's the people who send it in early that get audited. Don't know how true it is but I have never had a problem so far. Not that I plan it that way, more of procrastination!

 

[kandaandm]

I don't think that's true....I turned my taxes in on the last day and I'm getting audited.

 

[gringo220]

Well that sucks. I saw it on some news channel one night while I was watching it. But anyways, hope it works out for you and everything is ok!

 

[Pekkerwood]

I will dig and see if I find the article. Basically some professors did studies and found out patterns of "guesses". The IRS bought their software and use it to help pick out files to audit. It turns out our random guesses are far from random. I have saved it for years but have to find where I stashed it. Quite interesting.