If you own a business in California, you know what a challenge it can be. You have to make sure your operation runs smoothly, and that means managing people, time, money and more. One thing that all business owners have to deal with is taxes.
No one enjoys dealing with the Internal Revenue Service. Since paying taxes is a fact of life, however, you must fill out some forms once a year and send them in. Filing your taxes, however, is not always so simple. As a business owner, you have to fill out multiple forms and make sure everything matches up. Just one slip-up and the IRS will come calling. So what happens if they do?
If you receive notice of an audit from the IRS, it is important to not panic. Being audited can be scary, but you can get through it by being calm and compliant with the auditor. First, that means sending in the appropriate documents.
Before the auditor comes to your office, you will receive an Information Document Request. According to an IRS employee, it is best to send the documents that are requested and nothing else. If the auditor ends up needing more from you, he or she will let you know.
Next, you have to let the auditor perform the audit. You can deal with the auditor directly if you are comfortable, but you can also hire an attorney to work as a third party and help you through the process.
Finally, you will get the auditor's results. If you disagree, there is a process you can follow to appeal the findings.
Hopefully these tips will help you get through an audit if you ever end up subjected to one. Dealing with the IRS is always tricky, however, so if you are concerned about how your audit could go, it may be wise to talk to an attorney.
Source: Business Management Daily, "You're being audited! IRS answers 5 key questions," July 24, 2013