Small businesses have to pay income taxes, which are subject to audits from the IRS. Sometimes, business owners can trigger audits, and other times, they are completely random.
Audits can be time-consuming, costly, and stressful! What action steps can you take to avoid audits, and what steps should you take if you’re notified that you’ll be audited – even if it’s completely at random?
At CSI Accounting & Payroll, we’ve worked with small business accounting for over 50 years. During that time, we’ve seen a few clients go through random audits, and we’ve also accepted new clients who were going through audits when they contacted us. They wanted to know:
Remember, audits aren’t completely avoidable because some are done at random. However, you can minimize your chance of going through a business income tax audit by following these steps:
These steps won’t help if you’ve already received a mail notice from the IRS; there’s no avoiding an audit at that point. Last-minute changes made internally may be seen as an attempt to cover up intentional fraud, and any changes will be made by your IRS auditor later on as needed.
Your first notice of an audit should come in the form of a paper letter from the IRS. Immediately upon opening the letter, you should follow these steps:
Don’t want to handle an audit on your own? Most small business owners feel the same way.
The good news: Your accountant will likely handle the audit for you, including gathering materials, handling questioning from the auditor, and even launching the appeal process (if applicable).
The bad news: Nearly all accountants will charge extra for this support.
Back to more good news: CSI Accounting & Payroll includes audit representation for no additional fee! Here’s how we can support you in the case of an audit.
Now that you know how to avoid triggering audits, what to do if you’re being audited, and how a monthly accountant at CSI can support you through an audit for no additional cost, are you ready to check out monthly accounting services?
If so, please consider CSI Accounting & Payroll! To see if we can be a good fit for your business, click the button below for a free consultation:
Not ready to talk? That’s okay! First, learn more about what an audit is like, including the risk, the number of years the IRS can review, and how much time audits may cost you.