Tax Audit Lawyers in High Point
A "tax audit" is a procedure in High Point, North Carolina where the tax authorities investigate a taxpayer's (whether the taxpayer is a person or corporation) filings when it looks like there's some kind of discrepancy. However, many state and federal tax audits are the result of random selection, when the authorities don't necessarily think that a taxpayer has deliberately evaded their taxes.
The procedure of being audited in High Point, North Carolina is normally pretty simple. If and when the tax authorities decide to audit you, they'll send you a letter in the mail detailing what's about to happen. If you receive such a letter, it's extremely important that you make sure it's authentic. Sometimes, scam artists will send fake audit notices to people, claiming that they owe the government money. They will then collect their "taxes" and disappear. You should do an internet search for the name of the tax authority that the letter claims to represent, and call them to verify that you are being audited.
Once you receive the letter, and confirm its authenticity, you will have to meet with an auditor at the time and place mentioned 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 High Point, North Carolina
There are various different reasons why the federal government, or the tax authorities of North Carolina might decide that a tax audit is warranted in your case.
As considered earlier, an audit might happen due to a taxpayer being randomly selected. If this happens to you, and you have been straightforward on your tax returns, it's unlikely that you'll have much to worry about.
Nonetheless if the IRS or other tax agency suspects actual wrongdoing by a High Point, North Carolina 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.
If you claim such a massive number of deductions that your tax liability is unusually low, you may well be subject to an audit in High Point, North Carolina. A deduction is an allowable reduction in your taxable income, requiring you to pay taxes on a smaller portion of your income. Particular business expenses and charitable donations are frequent sources of tax deductions. However, some people add invalid deductions to their tax returns to reduce their tax burden. If the IRS is suspicious about your deductions, you should make sure you have relevant documentation to back them up.
How Can A High Point, North Carolina Tax Lawyer Help?
If you find yourself being audited in High Point, North Carolina, 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 obtain the advice of a High Point, North Carolina tax attorney immediately.