On September 1, 2009 I received a fat envelope in the mail from the IRS. They wanted to audit my 2007 tax return.
Immediately, I began searching the Internet for blog entries from normal people who had been audited. I was desperate to hear their insight and learn a few tips on how to survive the process. Unfortunately, I found very little useful information. For the most part, I ran across tax attorneys’ ads where they try to scare the crap out of you so that you’ll hire them to represent you during your IRS audit.
The most useful information I found was on Twitter. I used their advanced search engine and searched for several key word phrases (IRS Meeting; IRS Audit; IRS Letter, etc). While the tweets I found weren’t exactly life savers, they did give me some comfort during a very trying time. Seeing a tweet like this made me smile:
I will write about the audit process and how to prepare, but first I want to mention a few things that surprised or intrigued me.
- The IRS auditors sit in cubicles; they don’t have private offices. This means I could hear the audit-related conversations to my left, right, and across the aisle.
- My local IRS office has about 6 auditors. So, during an appointment, know that there will be five other citizens going through the same thing as you.
- The IRS auditors answer their personal cell phone calls in the middle of the audit. I was shocked by this. It was bizarre to listen as my auditor spoke into her cell phone and said, “Honey, I told you this already. The phone number is hanging on the fridge, under the pizza magnet.” Auditors have refrigerators and they eat pizza? Wow!
- IRS staff don’t know it all. The auditor assigned to my case frequently hollered over her cubicle wall to her colleague and said, “Hey, Tom, what’s the form number for extending the payment deadline?” And Tom would holler back, “I think it’s 4458 or 4423. Look under the ‘payment extension’ folder.” I was expecting things to be very formal and proper, so anytime I caught a glimpse of regular co-worker to co-worker banter and office interaction, I was sort of tickled.
- As you’re discussing your case, take your own notes. Don’t rely on the auditor to remember everything you’ve discussed. My auditor would add up receipts on her calculator and say, “Hmm. I’m off by $700.” To which I’d reply, “Did you remember to include the receipt for X?” And she would reply, “Oh, that’s right. I forgot.” That’s a $700 thing she forgot to include in her calculation. You need to stay on top of the details.
- The average audit lasts 2 hours. This may seem like a short amount of time, but it’s very intense. Bring a bottle of water with you. You’ll get thirsty. Trust me.
- The auditors have a great deal of discretion they can apply to your case. It’s best if you go in to the meeting confident, friendly and projecting an aura like you know what you’re talking about. They are experts at reading body language and non-verbal cues. I made an honest error when I first met with my auditor. I prepared and brought receipts for the wrong tax year. I got really confused. Upon realizing this, my auditor called her supervisor over and I swear to God that he was eyeing me to discern if I was telling the truth about bringing the wrong information.
More to come…