Tax Audit Lawyers in Pembroke

In Pembroke, Massachusetts, 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. Usually, 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.

The actual process involved in a tax audit in Pembroke, Massachusetts is usually fairly straightforward. If you hare chosen for an audit, you will receive a letter in the mail telling you as much. Before responding, it's essential for you to make sure that the letter is authentic, because there are scammers who send fake audit letters to innocent victims, in an attempt to extort money out of them. You should search the Internet for the name of the organization that the letter claims to represent, and call them using the contact information on their website, and confirm that you are actually being audited.

Once you receive the letter, and confirm its authenticity, you will have to meet with an auditor at the time and place specified in the letter, and subsequent communications with the auditor. The auditor will tell you what documents and records you need to bring to the meeting. They will then ask you some questions to clear up whatever discrepancy they found in your tax return.

Reasons For a Tax Audit in Pembroke, Massachusetts

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

A taxpayer can be chosen for an audit at random, even if the tax authorities don't suspect any wrongdoing. The idea behind these random audits is to keep taxpayers on their toes. So, if you are audited for this reason, and know that you've done everything thoroughly in filing your taxes, you will likely be fine.

On the other hand, there are also specific reasons why the tax authorities in Pembroke, Massachusetts might want to conduct a tax audit. The most common reason for a tax audit is suspicion that a taxpayer has not reported all of the income they earned in a particular year. This suspicion often arises when a taxpayer buys a large number of expensive luxury items, but only claims a small amount of income on their tax return. Obviously, the tax man will be very interested in learning where someone who is claiming a minimum-wage level income on their taxes got the money to buy a sports car.

Another common reason for tax audits in Pembroke, Massachusetts is when a taxpayer claims a large number of deductions. A deduction is just a legally-allowed 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 Pembroke, Massachusetts Tax Lawyer Help?

If you experience an audit in Pembroke, Massachusetts, and believe that you have properly reported all of your income on your tax filings, it will probably go fine. And if there is anything wrong with your filings, it was likely the result of an honest mistake, and auditors are generally sensitive to this fact. In such cases, the penalty is usually light. It will probably be little more than a requirement that you pay back taxes and interest.

But, there are some tax audits that are far more difficult and serious than a tax return having a few more deductions than usual. If this is the situation you're in, you should contact a Pembroke, Massachusetts tax attorney as soon as possible, to help make sure that your tax audit goes smoothly.