How to Handle an Audit Morton IL
Martin Hood How to Handle an Audit in Morton IL

Guidelines on How to Handle an Audit in Morton IL

Martin Hood business consultants can provide you with a step-by-step guide on how to handle an audit in Morton IL. Our accounting firm has helped navigate countless small business clients through the IRS audit process. Your business has not necessarily done anything wrong by receiving an IRS tax audit letter. However, the next steps you take will determine how many issues your business could experience during an audit. Our tax professionals have more than 40 years of experience in how to handle an audit. Contact us today for assistance in dealing with a tax auditor.

Do Not Ignore an Audit Letter

The IRS will not go away just because you choose to ignore or put off responding to a tax audit letter. In fact, you should pay extra attention to the letter to determine what information the IRS needs. Typically, the IRS suspects reporting errors if they see any of the following:

  • A business claiming many substantial deductions.
  • Companies that claim business losses for several years in a row.
  • A business that claims higher than expected income levels.
  • Companies with drastic shifts in year-to-year income.
  • Health care companies suspected of not providing accurate information on income, expenses, and deductions.
  • Lawyers suspected of not providing accurate reporting information.

Your company must respond to the IRS audit letter within a specified period, usually 30 days. It is important to not act suspiciously during the audit process. Otherwise, the IRS will suspect your business may have something to hide. If you need assistance, Martin Hood accountants can guide you on how to handle an audit in Morton IL.

Keep Records Organized

Companies without organized records will struggle to provide the information the IRS requests in an audit letter. Therefore, keeping organized records is an important step in how to handle an audit in Morton IL. Martin Hood CPAs can go through your audit letter, identify what the IRS wants to see, and help you organize information to provide the best response. Records that you will need for an audit include the following:

  • Leases or titles of business property
  • Hard copies of tax prep information
  • Receipts or invoices of expenses and income
  • Accounting books or ledgers
  • Bank statements
  • Canceled checks

Use Caution When Answering Auditor Questions

Often, small business owners can create more issues for themselves by sharing too much information with the IRS. When the auditor asks a question, provide only enough information to give a satisfactory answer. That way, you can avoid providing answers to the IRS that could lead them to audit even more tax returns from past years. An auditor cannot overlook mistakes made in financial reporting information. No matter the intentions of your business, you will not benefit by pointing out any mistakes in information the IRS had not previously identified in the audit. Contact Martin Hood business consultants if you need any more assistance in how to handle an audit in Morton IL.

Let Professionals Represent Your Business

Hiring a tax professional to represent you in talks with an auditor may be the best way how to handle an audit in Morton IL. You can save stress and avoid oversharing information by letting Martin Hood accounting pros speak for you. After all, many small business owners can get defensive or antagonistic during the auditing process. However, it is in the best interest of your company not to give an auditor extra incentive to find financial reporting errors. Martin Hood’s experienced tax pros can help you navigate the audit interview.

How to Handle an Audit Morton IL

Contact Our Local Accountants

Martin Hood accounting professionals can provide you with all the tips and guidelines you need to handle an audit in Morton IL. Give us a call now at 309-220-5519 to discuss how we can help. If you prefer, you also can use our online contact form to request a consultation.