The best way to prepare for a business IRS tax audit is to have a tax advisor on your side. It is best for your representation before the IRS. He will know how to find solutions for your tax audit problems. He will best respond to the auditor’s suspicions.
However, if you decide to represent yourself before the IRS, it is very important to have all your records that will prove your deductions.
When preparing for a business IRS tax audit, you should gather up receipts, bank statements, invoices, auto records, books and records, travel and entertainment records and other relevant proof for your expenses and deductions. See IRS Audit Advice.
HOW TO AVOID A TAX AUDIT IF YOU ARE A SMALL BUSINESS OWNER?
A professional accountant knows how to reduce your chances of being audited. If you are a small business owner and you are looking to avoid the time and expense of a tax audit examination, you should avoid having a careless return, keeping separate, personal deductions from business deductions.
Keep good records of your expenses. Don’t round up numbers. For more information concerning help with an IRS tax audit, contact us.
WHY SMALL BUSINESS OWNERS ARE BEING AUDITED?
One reason most small business owners and self-employed people are being audited is because they deal in cash and money not reported to the IRS. This establishes potential unreported income opportunity. Personal deductions are often claimed by small business owners as business deductions.
There are other criteria the IRS auditors use when selecting tax returns for audits. Best thing to do plan your taxes in advance and keep your records for an eventual tax audit.
We can help prepare your business tax returns and get the deductions you deserve, without having the fear of an IRS tax audit!
See more on IRS Audit Advice.
MY BUSINESS DEDUCTIONS WERE DISALLOWED BECAUSE THE IRS SAYS MY BUSINESS IS A HOBBY!
The “hobby loss” rules can be interpreted by the IRS to favor them.
You may need quality audit representation.
See More On Audit Representation.
MY BUSINESS IS BEING AUDITED. HOW WILL THE IRS AUDITOR CONDUCT THE TAX AUDIT? HOW LONG WILL THE AUDIT LAST?
It depends on your individual situation and your response to their requirements. See more on IRS Audit Advice.
MY BUSINESS IS BEING AUDITED. HOW DO I SURVIVE TO AN IRS AUDIT?
Review your tax returns that are being audited. Gather all the information required. Hire a tax professional to help you answer the auditor questions.
See IRS Audit Advice.
HOW TO PREPARE FOR A BUSINESS TAX AUDIT? WHAT DOCUMENTS THE AUDITOR WILL REVIEW? WHEN EXAMINING MY BUSINESS RECORDS, WHAT WILL THE AUDITOR LOOK FOR?
They will verify bank statements and deposits to the income you reported, deductions for your business expenses, payroll taxes, employees’ classification, and other financial records. See more on IRS Tax Audit.
DURING A SMALL BUSINESS TAX AUDIT, WILL THE AUDITOR QUESTION MY PERSONAL FINANCES?
Yes. They may verify your income reported on your tax returns and your current expenses to see if they match. See IRS Audit Advice
SURVIVING A BUSINESS TAX AUDIT! HOW TO PROVE BUSINESS EXPENSES? WHO SHOULD GUIDE ME THROUGH THE IRS EXAMINATION?
Document your expenses. For tax collections purposes, the IRS has developed ways to highly train auditors. If you want to have a successful tax audit, get tax professional help. They will make sure you are not missing any critical documentation regarding your business expenses. See IRS Audit Advice.
MY BUSINESS IS BEING AUDITED. HOW CAN I PROVE PERSONAL AND BUSINESS EXPENSES FOR TRAVEL EXPENSES?
The IRS allows certain deductions for travel expenses when traveling for business purposes. However, the IRS is going to request verification for the business deductions you claimed for personal purposes, if you claimed more than you were allowed to claim. Be prepared with reasonable answers, and make sure you have all your receipts. See more on IRS Audit Advice.
TIPS FOR PREVENTING A SMALL BUSINESS TAX AUDIT! WHAT ARE THE TRIGGERS, RED FLAGS FOR A TAX AUDIT?
Home office business deduction, combining business expenses with personal expenses, use of personal car for your business, cash and unreported income, entertaining expenses. These are few common triggers for a tax audit. See more on IRS Audit Advice.
If you are considering hiring us, call Joe Mastriano, CPA 713-774-4467.
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