Fear the IRS audit, Here is how to Survive it

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<h1>Fear the IRS audit, Here is how to Survive it</h1><strong> Author: <a href='http://www.articleseen.com/profile_Lawrence J. Danny.aspx'>Lawrence J. Danny</a></strong><br /><p>Internal revenue service (IRS) is a confederate agency of the United States formed for the purpose of collection and administration of taxes and its related laws. IRS provides a lot many opportunities to the individuals and the organizations to save their tax liability, but ultimately it depends upon the authenticity of the accounts of the organizations especially at the time of audit. In case the records are not authentic it will be quite difficult for them to defend against IRS. The chances of audit by IRS depends upon various factors such as the amount of income, profession pursuing, the place of business, transactions, the large amount of charitable donations and many more.IRS considers omnifarious determinants before deciding upon selection of an organization for the tax audit. Audit by IRS is not necessarily conducted just because of fallacious records. IRS selects the firms for audit through various ways such as random selection or when the record of the organization doesn’t match with the information provided by them. It has been reported recently that the number of small businesses audited by IRS has subsequently increased and the number of large corporations audited have declined notably. One reason why IRS is concentrating on small businesses can be to meet a certain target of auditing returns. Owning a small business is in itself bait for IRS. IRS audit small business usually which are self-employed or which are suspected to have infringements. Audit may be conducted within the premises of the business or at the office of IRS but small businesses should prefer to hold audit at the place of business as the auditor gets an apparent impression of the state of the business. IRS audit small business only in case of discrepancies and the most suitable way to anticipate in this situation is prepare a good record before filing of the tax, so that in case the organization is chosen for the tax audit by IRS, all the necessary records will be in hand. At the end of the IRS audit, the officer of IRS will conclude the problems and notify for the necessary actions to be taken. IRS audit results can be reconsidered in case the organization is not satisfied with it. A complete procedure is to be followed in this case. IRS will reconsider the application only after scrutinizing the required application form. Audit by the IRS may be conducted because of the following reasons: very low income of a very large organization in order to evade the tax liability, inadequacy of returns, very high fluctuations in income, private gains, presenting a very high value of income etc. Audit by the IRS may conclude for penalties on the defaulters depending upon the character of tax payment: • 20% penalty in case the amount of tax underpaid is associated with the wrong assessment of property or neglecting the rules and regulations laid down by IRS. • In case of violations such as failure to file on time, the interest will be accumulating from the due date of filing the return till the date when the penalty is actually paid. Audit from IRS puts a fear of GOD in the minds of people. It is always better to consider the notice of tax audit sincerely without ignoring it and following the instructions as mentioned in the notice. Audit from IRS can certainly be avoided by being honest, following the rules and regulations as mentioned by IRS, filing the tax return timely and keeping all records up-to-date. Filing of tax returns depends mainly on the income, filing status and the age of the individual. There may be certain cases when the individuals and organizations may not be able to file their tax returns for several years. Unfiled tax returns can be subsequently filed up before IRS finds it out otherwise the company may have to face legal as well as criminal charges. While filing the unfiled tax returns, it is always advisable to file the form of the relevant year in which the return has not been filed as IRS makes changes every year in its tax return form. Audits are an integral part of any business. But it is always recommended to be true and present a fair view of the business in order to avoid any interference from the Internal Revenue Service department. For more information visit us at http://www.cpaformerirsagent.com/ </p><strong>About the Author:</strong><br />Lawrence J. Danny is an author of this article who writes about the IRS audit, <a rel="nofollow" href="http://www.cpaformerirsagent.com/"><b>IRS audit small business</b></a> and audit by IRS. He has also written about the importance of <a rel="nofollow" href="http://www.cpaformerirsagent.com/"><b>audit by the IRS</b></a> and Unfiled tax returns and Audit from IRS.<p> Article Source: <a href='http://www.articleseen.com/Article_Fear-the-IRS-audit-Here-is-how-to-Survive-it_134149.aspx'> http://www.articleseen.com/Article_Fear the IRS audit, Here is how to Survive it_134149.aspx</a></p>

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Category : Finance : Finance