Tax Audit Lawyers in Kokomo
In Kokomo, Indiana, a "tax audit" is a procedure in which the IRS or local tax authorities conduct an investigation of a taxpayer's tax filings, looking at them in more detail than they ordinarily do. Normally, they do this because there is something suspicious in the tax return. State and federal tax authorities also do a some number of random audits each year, without necessarily suspecting that an individual auditee has done anything wrong.
In Kokomo, Indiana the procedure of being audited is relatively simple. If you are chosen to be audited, you will receive a letter in the mail telling you as much. It's important to verify the authenticity of this letter, because sometimes con-artists will pose as tax authorities, and conduct fake audits of unsuspecting taxpayers, then claim that they owe the government more money. If the victim pays, the scammer takes the money and runs. To verify that a letter is authentic, you should contact the nearest branch of the relevant tax authority. Do not simply call the number provided to you in the letter, since it will probably lead to the scammer. Use a phonebook or the Internet to find the actual number you should call.
After confirming that the letter informing you of your audit is authentic, there are many things you can do to prepare for your meeting with the auditor. The initial thing you need to do is call them and arrange to meet at a time that's mutually convenient. You should bring any documents and records that the auditor requests, as well as any proof that you think might be helpful in answering the auditor's questions. The auditor will ask you any questions that he or she believes will clear up whatever contentions they have with your return. You should answer all of these questions truthfully, as it is illegal to lie to a tax auditor.
Reasons For a Tax Audit in Kokomo, Indiana
There are plethora of reasons why Indiana's government, or the federal government, might conduct a tax audit.
As mentioned earlier, you might get audited just because you were chosen at random. If this is the case, and you know that your tax return was totally truthful, and have the documentation to back it up, you shouldn't have anything to worry about.
Nonetheless if the IRS or other tax agency suspects actual wrongdoing by a Kokomo, Indiana taxpayer, that's a different matter. There are various different reasons why a government might determine to audit a taxpayer. The most frequent one is suspicion that they have underreported their income. If a taxpayer buys a massive number of expensive luxury items, but reports little or no income on their tax returns, the government will definitely want to discover where the money to buy all those things came from, and why it hasn't been declared as taxable income.
It is also typical to be audited in Kokomo, Indiana if you claim a wide number of deductions. A tax deduction is simply a legal subtraction from one's taxable income. Various different expenses, including charitable donations, interest paid on mortgages, and others, are deductible from one's taxes. If you claim so many deductions that you have negated almost all of your tax liability, you can bet that the government is going to be suspicious.
How Can A Kokomo, Indiana Tax Lawyer Help?
If you find yourself on the business end of a tax audit in Kokomo, Indiana, and you are sure that you have reported all of your income, and not claimed any invalid deductions, chances are you were just chosen at random for an audit, and you likely don't have any cause for concern, other than the inconvenience that an audit represents. If you are deemed to owe any back taxes, and your failure to pay in the past was the result of an honest mistake, you'll likely be afforded a chance to pay any taxes you owe from past years, with the possible addition of interest.
However, there are some tax audits where the underlying facts are much more intricate than a simple misunderstanding. In these cases, a good tax attorney in Kokomo, Indiana may be necessary to ensure that the process is as painless as it can possibly be.