Tax Audit Lawyers in Tell City

In Tell City, 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. Typically, 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 Tell City, 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 various 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 concerns 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 Tell City, Indiana

There are numerous different reasons why the federal government, or the tax authorities of Indiana might decide that a tax audit is warranted in your case.

As considered earlier, tax audits can be conducted at random. Apparently, the government doesn't have the resources to audit every taxpayer under their jurisdiction. But, by conducting a substantial 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 definately have nothing to worry about.

Nonetheless if the IRS or other tax agency suspects actual wrongdoing by a Tell City, Indiana taxpayer, that's a different matter. There are numerous different reasons why a government might determine to audit a taxpayer. The most typical one is suspicion that they have underreported their income. If a taxpayer buys a considerable 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.

Another typical reason for tax audits in Tell City, Indiana is when a taxpayer claims a large number of deductions. A deduction is just a legally-permitted subtraction from a person's taxable income. For example, charitable donations can be deducted from one's income in the full amount of the donation. Nonetheless, if a person claims a very large number of deductions, to the point that they claim little or no tax liability, the tax authorities are going to take a closer look.

How Can A Tell City, Indiana Tax Lawyer Help?

If you find yourself being audited in Tell City, Indiana, and are sure that you have done everything right in preparing your taxes, then the audit will likely be over rapidly, with no penalties imposed. In cases like this, if anything is found to be wrong with your tax return, it is likely the result of an honest mistake, and the auditor will be aware of this, and will likely give you an opportunity to correct your mistake, without suffering any penalties, with the possible exception of being made to pay interest on any back taxes you owe.

However, there are times when an audit is conducted to investigate far more significant issues. If you find yourself facing allegations from the IRS of serious wrongdoing, and believe yourself to be innocent, you should pursue the advice of a Tell City, Indiana tax attorney immediately.