If you have filed your federal tax returns on time, you usually feel pretty good. That is, until you receive notification from the IRS stating an audit will be conducted of your return. When this happens, people often panic, thinking they will automatically be put in jail, lose their home or business, and other events that could lead to personal and professional ruin. However, it doesn’t have to be that way. For those smart taxpayers who choose to utilize the services of an experienced and knowledgeable tax lawyer when attending their audit, the results can be more than satisfactory. If you are preparing for an audit, here are some risks associated with attending your hearing without a tax lawyer by your side.
Lack of Experience
While a tax lawyer will be very experienced in dealing with audit proceedings, you are not. Because of this, you are very likely to incriminate yourself during the hearing, often without even realizing you have done so. Along with this, you will look guilty, and be far more stressed out than if you have a tax lawyer who understands the complexities of these investigations.
During audit proceedings, the IRS can force the accountant who handled your tax returns to testify against you. Therefore, if you have committed fraud, your accountant will tell the IRS everything, virtually guaranteeing you will wind up in prison. However, if you work with a tax lawyer, the IRS cannot force your attorney to testify against you in a hearing. Thus, no matter what secrets or other information you have shared with your attorney, you can be sure they will not be revealed, thanks to attorney-client privilege.
When an audit occurs, the IRS usually looks back over several years of a taxpayer’s financial records and tax returns, then prepares a series of questions designed to determine just how truthful the taxpayer has been in reporting their income. Needless to say, if you choose to go it alone, you will spend hours and hours combing through your records, trying to figure out what you will need with you during the hearing. However, by using a tax lawyer who will likely already know what’s needed, your prep time will be cut substantially, giving you peace of mind along the way.
Communicating with IRS
When you receive letters from the IRS, it’s often difficult to know exactly what they mean. Because of this, you may misinterpret something that could be crucial to your audit. Therefore, it’s best to work with a tax lawyer before and during your audit, since they can interpret the information correctly and communicate directly with the IRS on your behalf.
In almost any situation where an audit will be taking place, it’s best to have a skilled tax lawyer working with you to see that your legal rights are protected every step of the way. Rather than go it alone and risk losing your case, let an experienced tax lawyer do the hard work for you.
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