Answers to frequently asked questions from our clients
IRS and state governments select individuals for audit for a variety of reasons including:
- Discrepancies between the income and deductions on your tax returns and the reporting documents filed with the IRS.
- The amount and type of income reported on the tax return.
- The amount and type of deductions being claimed on the tax return.
- The type of industry you work in may be a target of current interest to IRS.
- You claimed dependents on your tax return that have also been claimed by another person on their tax return.
Our fees for supporting you during an audit vary according to the complexity of the audit and whether we prepared the tax return being audited. A summary of our fees is as follows:
H&S Accounting & Tax Services prepared the return being audited
If we prepared your return, we will meet with you to review the audit letter at no charge. We will also provide up to one hour of audit assistance in our offices to help you prepare your records for the audit at no charge.
If you would like us to attend the audit with you, we will be happy to do so. Our fee for accompanying you to the audit is $75 per hour. IRS audits generally last 2-3 hours.
H&S Accounting & Tax Services did NOT prepare the return being audited
If we did NOT prepare the tax return being audited, we will meet with you at our offices to review your audit letter and provide initial recommendations on what you need to do to prepare for the audit.
- Our fee for a 30-minute Initial Audit meeting is $50.
- If you would like us to help you prepare for your audit, our consultation and preparation fees are $125/hour.
- Bookkeeping fees are $70 per hour.
- If you would like us to accompany you to the audit, our fee is $120/hour.
The average length of an IRS audit is 2-3 hours. The average amount of time it takes us to prepare for an audit varies according to the complexity of the audit and how organized your tax records are.
If you are selected for audit, we offer the following audit assistance services:
- We will meet with you to review the nature of the audit and discuss what steps must be taken to prepare for the audit.
- We will advise you as to the documentation and other supporting documents you will need to prepare for the audit.
- If requested, we will assist you with preparation and organization of tax records and documentation so you are adequately prepared for meeting with the auditor.
- We can accompany you to the audit and/or represent you during the audit proceedings.
- We can advise you as to the accuracy of your tax return filings and whether adjustments are required under tax laws.
- Where appropriate, we can assist you in the audit appeals process.
If you have been selected for audit, it is natural to feel some level of fear; however it is important that you promptly and immediately take the following actions to ensure your audit goes as smoothly as possible:
- Contact H&S Accounting & Tax Services immediately, and
- Fax, email or deliver a copy of the audit letter to our office.
- You must also contact the IRS or state auditor within the time prescribed in the audit letter.
You should approach the audit with discipline and recognize that you will need to put time into gathering records and preparing for the audit if you want the audit to go well. Prior to meeting with the auditor, we strongly recommend you meet with our Tax Consultant or our CPA to discuss the audit and what you will need to do to be prepared.
Generally, it is much easier and less expensive to meet with us BEFORE you attend the audit. You can minimize fees and improve your chances of finishing your audit with little or no tax due if you act promptly and follow our advice.
Cleaning up after an audit takes more time and costs much more than preparing for the audit properly. However, if you decided to attend the audit alone and do not like the outcome, we have a track record of being able to dramatically reduce or eliminate tax assessments made by auditors.
Please bring the following documents with you to your first audit meeting at H&S Accounting & Tax Services:
- A copy of the IRS/state audit letter
- A copy of the tax return being audited and tax returns from the two preceding tax years
- Social security cards and birth certificates for all dependents claimed on your tax return
- If you have a business, please bring QuickBooks, Quicken, Excel or other records of your business income and expenses
- Receipts for deductions claimed on your tax return including: charity, medical, employee business expenses, and home mortgage interest and real estate taxes
- Receipts for childcare expenses (if you paid for childcare)