The IRS can audit you by mail or in their offices, your office or your home. The location of your audit is a good indication of the severity of the audit. Typically, audits by mail are for missing information in your tax return that IRS computers have attempted to find. These usually include W-2's and 1099 income items or interest expense items. This type of audit can be handled through the mail with the correct documentation.
The IRS office audit is usually with a Tax Examiner who will request numerous documents and explanations of various deductions. This type of audit may also require you to produce all bank records for a period of time so that the IRS can check for unreported income. The IRS can examine back not just three years as most people believe but up to six years if you underreported your income by 25%, or forever if you have not filed a tax return or have committed fraud.
The IRS audit scheduled for your home or office should be taken more seriously and has a Revenue Agent as the IRS Auditor. Revenue Agents have much higher education levels and have received more training in auditing techniques. All IRS audits should be taken seriously as they often lead to other tax years and other tax deductions not originally stated in the letter explaining that you are being audited.
The CPA's of Kenneth D. Eichner, P.C. represent taxpayers regularly in all types of audits by using the same basic technique: we perform a trial audit in our own office before the actual audit to determine as many facts as possible. This trial audit often discloses missing information or documentation. The early detection of problem areas allows the CPA's of Kenneth D. Eichner, P.C. to help the taxpayer in locating additional documentation that may be critical in proving a valid deduction.
Any audit for which Kenneth D. Eichner, P.C. is retained will take place at the IRS office or at the Kenneth D. Eichner, P.C. office, but never at your home or office. Very rarely do we request a taxpayer’s attendance at the audit. The IRS will often request to interview you, the taxpayer, but unless we feel that it is in your best interest, the CPA's of Kenneth D. Eichner, P.C. will politely decline their request. Because of our experience and expertise, it is often possible that we are better able to explain your records to the IRS than you, you are able to. The fact that Kenneth D. Eichner, P.C. has reviewed all records prior to the audit usually results in a favorable IRS audit report.