Tax Audit Lawyers in Dickinson
A "tax audit" is a procedure in Dickinson, North Dakota 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 Dickinson, North Dakota 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 have made sure that your audit is indeed real, you can do a few things to get ready for it. Most vitally, you should gather all of the documents that the auditor has asked for, as well as any additional documents and evidence that you think might help clear up any confusion about your tax return. You should bring these to the meeting with the auditor, and truthfully (to the best of your knowledge) answer all of the questions that the auditor asks.
Reasons For a Tax Audit in Dickinson, North Dakota
There are several reasons why the federal government, or the government of North Dakota may want to audit a taxpayer.
As discussed earlier, an audit might occur 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.
On the other hand, there are also certain reasons why the tax authorities in Dickinson, North Dakota might want to conduct a tax audit. The most frequent reason for a tax audit is suspicion that a taxpayer has not reported all of the income they earned in a given year. This suspicion often arises when a taxpayer buys a massive number of expensive luxury items, but only claims a small amount of income on their tax return. Obviously, the tax man will be extremely interested in learning where someone who is claiming a minimum-wage level income on their taxes got the money to buy a sports car.
Likewise, trying to deduct a large percentage of your income is likely to raise suspicions. A tax deduction is a way to reduce one's tax liability by making some of one's income non-taxable. Some frequent sources of tax deductions in Dickinson, North Dakota are business expenses and charitable donations. Some people, however, try to include false deductions in their tax returns (trying to deduct charitable donations they never really gave, for example). A massive number of deductions will be highly suspicious to the tax authorities, and they will want to see evidence to support every deduction you claim, if you're audited.
How Can A Dickinson, North Dakota Tax Lawyer Help?
If you experience an audit in Dickinson, North Dakota, 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 normally light. It will probably be little more than a requirement that you pay back taxes and interest.
However, if the situation is more confusing, you may need to hire a Dickinson, North Dakota tax attorney. A tax attorney can help you through your audit, and make sure it goes as smoothly as possible.