3 Reasons Why A Tax Expert Should Represent Your Business in an IRS Audit
IRS audit is part of the taxation landscape set out for commercial entities. Audits are not always evoked in order to unmask some financial corruption. In fact, in most of the cases, the IRS summons companies and individuals for audits that only end up rectifying some technical and procedural accounting mistakes.
So, there is no need to worry whenever you receive an audit notice from the IRS. If you have done nothing wrong, you are not going to land in any sort of trouble. However, accountants and tax preparation experts recommend that small business owners should not represent themselves in the IRS audits.
There are several reasons why self-representation during IRS audits can turn into a counterproductive measure.
1) You Have to Waste a Lot of Your Precious Business Time
No matter how good you are with accounting and bookkeeping, you can’t be prepared for detailed IRS audits. So, if you are going to represent your business on your own, get ready to cancel many appointments and extend many deadlines because you can’t simultaneously keep your focus on two different fronts.
2) You Are Going to Exhaust Yourself
Keep in mind that you have to do a lot of preparation if you are going to deal with IRS guys for the first time. Preparing all the documents on your own and then representing your business in the audit will take a lot of toll on your mental and physical health.
And even after experiencing all that burnout, you can’t be sure if you have represented your business in the right manner. There is no reason to take all that stress when you can easily deal with the audit via expert IRS representation that many tax preparation firms offer.
3) You Might Get Stuck in the Audit Sinkhole
IRS personnel are there to dissect the finances of the given businesses from all angles to make their efforts meaningful. They try their best to invoke return adjustments at the end of the audit. For that, they often try to excavate the financial information from the representative that he/she is not obligated to give by your tax preparation firm.
The disclosure of this information often makes the audits more laborious and exhaustive, and might also result in return modifications. In contrast, IRS guys are not able to play their tricks with tax preparation experts who have ample experience of IRS representation.