The IRS examines every return with the help of their computers and compares their own information and third party information to it. If the IRS finds an error, you will receive a correspondence audit notification. You might think that your IRS Problems are just starting when you receive this notice but you can take care of it if you follow the directions on the notice and do it before the deadline.
A correspondence audit is requested when there are questions regarding specific items on your tax return. Additional documentation may be required to determine if there actually has been an error made on your return. If it is a math error, you may be asked to pay more taxes including the interest and penalties that have accrued or, if it is in your favor, you may receive a refund.
This is a reason why you should always keep copies of your tax returns and its attached documentation just in case questions do arise from the IRS.
When you receive a correspondence audit, do not ignore it as this could ensure the start of IRS Problems. Read it carefully and follow the directions. Compare your tax return with the information you receive from the IRS. Do not send the IRS additional money until you have actually determined there is an error.The IRS has been known to make mistakes too.
If the findings from the IRS and your tax return agree, then sign and date it and return it with the necessary payment. If you disagree with the IRS findings, follow the directions on the notice. Return the information by the stated deadline along with copies of documentation that supports your findings.
After the IRS evaluates your findings and agrees with them, it will notify you of such and the audit is over. If, however, the IRS disagrees with your findings you will be sent an Examination Report. You will have 30 days to either accept the IRS’s findings and sign the report or execute your appeal rights to the IRS’Office of Appeals.
If any questions arise, you may call the name and number listed on the report or write to them asking for a return call.