OT: Getting Audited by Uncle Sam - Advice?

Submitted by Raback Omaba on
I just got the letter in the mail notifying me that the IRS would like to audit my tax return from 2010. I am self employed, do decently well but am far from a big shot. Also, I don't have anything to hide as far as malfeasance or criminal acts go. That being said, I am still shitting myself right now.

Any advice from fellow mgobloggers on the process?

Also, I am a Detroit area resident and have decided that I should get professional representation - any recommendations?

Goal is to get this out of my hair as quickly as possible.

Sorry if too OT

MGoUberBlue

August 24th, 2012 at 8:54 AM ^

The advice was great, but I read all of the posts and am now terrified of ever receiving such notice. 

Will be hitting the xanax immediately, then a Bloody Mary.  At least it's Friday.

Joined: 06/06/2011

MGoPoints: 4443

pullin4blue

August 24th, 2012 at 10:35 AM ^

I own my own business. I have had my personal returns audited twice and my business returns audited once. I guess in reality, my business was audited 3 times since the K-1 from the business was part of the personal return. My only advice is " Buclke Up"

IRS was not easy to work with. Of the three audits over a 5 year period my accountant was overly aggressive on mortagage interest deductions on the first return only. I got hit with the difference and a fairly hefty penalty. Since I had an accountant, I had him take care of things as my representative with the IRS (but then also part of the penalty). There were no findings on subsequent audits.

Since my initial audit I have received so many letters of inquiry that I am sick of the IRS. All the audit did was put me squarely on their radar. As Doug Karsh says "best-a-luck"

Joined: 08/14/2009

MGoPoints: 1597

I3lackcell

August 24th, 2012 at 10:43 AM ^

Personally I would contact a local accountant.  If you are near Rochester I can vouch for Bill Estes (248) 651-9899.  Being self employed you may even be missing deductions that you should be getting.

I have actually been audited twice, both times because I made stupid mistakes on my return. Sometimes its just a wrong number, or accidently using last years form that can get you pulled.

The corporate clients I work with get audited non stop.

Joined: 10/29/2010

MGoPoints: 311

triangle_M

August 24th, 2012 at 12:08 PM ^

I've been audited three times.  Its not that big of a deal although it can be if you are deliberately hiding something.  Once they find you did something wrong though, you're more likely to be audited in the future.  I had to pay around 20k in fines etc because I undereported.  I didn't do it on purpose, it was right in the middle of my divorce so it was just more fuel for the soul-sucking tire fire that was my life at that time.   It wasn't pleasant, but it wasn't cause for all of the panic either.  They have installment plans and all of that nonsense if you end up needing it.  Best of luck to you.

Joined: 03/09/2011

MGoPoints: 5648