Tax Lawyer's Blog

Tax Girl Kelly Phillips Erb’s law firm has been selected for an IRS examination and she intends to write about it:

I actually thought long and hard about whether to post about my audit. Many of my colleagues warned against it, citing all kinds of good advice from “you don’t want to tick off the Service” to “it might be too much information for your readers.”

While I appreciate the kind thoughts and consideration, one of the things that I love about my blog is that it gives me the opportunity to share what I’ve learned about taxes – and maybe that means from law school or a CLE or from my vociferous reading of tax news. And maybe it means my own experiences.

So, I’m trying to take something positive from the whole mess. Besides blog fodder (how convenient is that?), it is giving me some additional perspective from the client side – and that can only be good, right?

Absolutely.

I applaud Kelly for her loyalty to her readers and would caution everyone to recognize that if the IRS chooses to audit your tax return it in no way is evidence of any wrongdoing. A healthy percentage of audits result in either a no-change or the taxpayer receiving an additional refund. As Kelly said, her audit was probably triggered by her honest correction of an error made on the original return.

While Kelly isn’t looking forward to the process, she says she is prepared for it:

For those of you who have never been audited, let me advise that the experience isn’t fun. The requests for information can be somewhat overwhelming – especially for a small business. Our bookkeeper has spent days and days putting together charts and reports. We’ve been printing out ledgers and bank account statements and desperately looking for supporting documentation. It’s all part of the examination process.

Good luck, Kelly, and teach those auditors a thing or two about taxation.

Related Posts:

• IRS Audits: The Statute of Limitations on Assessment
• Tax Disputes and the Burden of Proof
• 5 Slam Dunk IRS Audit Red Flags
• How the IRS Selects Returns for Audit

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