Tax Audit Lawyers in Marshalltown
A "tax audit" in Iowa is the process by which the relevant tax authorities (either the IRS, at the federal level, or its state equivalent) investigate a tax filing in more detail than they do for ordinary filings, usually because there appears to be a discrepancy, or some other suspicious item, in somebody's tax returns. However, the IRS (and state tax authorities) sometimes do rounds of random audits, where they audit taxpayers at random, without necessarily suspecting them of any wrongdoing.
In Marshalltown, Iowa, the process of a tax audit is generally not confusing. If you get a letter saying that you have been chosen for an audit, you should still take it seriously, however. The first thing you need to do is confirm that you are actually being audited, because there are fraudsters who impersonate tax collectors, attempting to squeeze money out of innocent victims. When you receive such a letter, you should use the phone book or Internet to find the contact info for the government agency that the letter claims to be from, and contact them. Do not rely on any contact information provided in the letter, as it may direct you to the scammer, who will simply pretend to be a representative of the IRS.
After confirming that the audit you're facing is actually legitimate, there are a few things you can do to prepare. First, you should assemble all of the relevant documents you have in your possession. This should include your tax return, W-2 forms, and records of any expenses that you claim as deductions. You should bring these documents, and any others that the auditor requests, to the meeting. At the meeting, the auditor will ask you a series of questions, which you should answer honestly and to the best of your knowledge.
Reasons For a Tax Audit in Marshalltown, Iowa
There are many reasons why the federal government, or the government of Iowa may want to audit a taxpayer.
As discussed earlier, tax audits can be conducted at random. Obviously, the government doesn't have the resources to audit every taxpayer under their jurisdiction. But, by conducting a significant number of random audits each year, taxpayers are, in theory, discouraged from cheating on their taxes, because they know that they might be audited randomly. If you are chosen for a random audit, and have done everything right, you almost certainly have nothing to worry about.
On the other hand, some taxpayers in Marshalltown, Iowa are audited for a specific reason, rather than being drawn at random. If the tax authorities believe that you have underreported your income, that is a very common reason for a tax audit. For instance, if you claim on your tax return that you make ,000 per year, and, in the same year, purchase an expensive luxury item, the tax authorities will wonder where you got that extra money, and why you're not paying taxes on it.
Claiming an unusually-high number of deductions is another common reason for tax audits in Marshalltown, Iowa. A tax deduction is some expenditure that you can subtract from your taxable income, thereby reducing your tax liability. If you claim such a huge number of deductions that your tax liability has been reduced to almost nothing, the IRS will probably want to make sure that all of these deductions are valid.
How Can A Marshalltown, Iowa Tax Lawyer Help?
If you end up being tax audited, and you believe that you have not engaged in any wrongdoing, it's likely that you've been chosen randomly for an audit in Marshalltown, Iowa. If this is the case, you shouldn't be worried. If you are found to have made a mistake on a past tax return, and paid less than you owed, you'll probably just be made to pay the balance due, plus a little bit of interest, without incurring any additional penalties.
But, in more confusing cases, chances are you would be well-served by a tax lawyer in Marshalltown, Iowa, to ensure that your tax audit goes smoothly.