Professional Freedom Tax Service - We won't file until you smile!

Recent Posts

IRS investigating Liberty Tax
6 Tax Red Flags That Can Get You Audited
Teach Your Kids About Money (They'll Thank You Later)
Police warn of IRS scams during tax season
Consultant's Corner: Irs Schedule C Audit..


Filing a late tax return
Freedom Talk
General questions
Self Employed Individuals
powered by

Tax Service Blog

Consultant's Corner: Irs Schedule C Audit..

Question: I have just received my first notice from the IRS indicating that there will be a Schedule C Audit. What should I expect?
The IRS should have provided you with an Information Document Request that will tell you specifically what they want to review in this first meeting. Review this document request with your accountant as a first step. The time spent gathering and organizing the required supporting records is often more than the time that will be spent in the meeting with the IRS. The more of the prep work that you can handle, the more you control your costs related to the audit. You will, of course, want to review the documents with your accountant and then get your accountant’s thinking about the advisability of handling the meeting on your own.
One of the keys to your initial meeting is to only respond to the questions that have been asked. Don’t take more into the meeting than is needed to be responsive. Your accountant will be useful in helping you to determine what to take. Your accountant can also help you understand the need to keep your comments limited to only what is required to be responsive. We’re assuming that your accountant prepared the returns and is familiar with your Schedule C and with your knowledge of the Schedule C. Your accountant can help you do a self-audit ahead of the IRS meeting. The results of the self-audit may point out gaps in the documentation or gray areas that are best communicated by a tax professional. If that is the case, you will likely want to have your accountant handle the meeting. You may even decide not to attend the meeting at all and have your accountant work on your behalf with a Power of Attorney.
The following tips and information may be useful as perspective on the audit process:
  • Don’t wait until the meeting to look over the documentation. Know what information the IRS will be looking at and anticipate questions that might be asked about it. Have backup materials ready to answer those questions.
  • Let the IRS lead the meeting. Don’t bring up anything the IRS agent does not. Answer only the questions you’re asked. Even an innocent statement made by you could lead an IRS agent to expand the investigation into your finances.
  • Don’t be defensive. The meeting is unlikely to be pleasant, and you may feel emotional about having someone question your finances. Don’t allow those feelings to take control of the situation. Remain calm and pleasant. If you feel you are unable to remain calm, it might be a good idea to have a tax professional handle the meeting without you.
When faced with an audit, it’s easy to conjure up visions of all the things that can go wrong as a result of the investigation, but by being prepared, you can walk away from the experience having lost only a minimal amount of time in the process.

13 Comments to Consultant's Corner: Irs Schedule C Audit..:

Comments RSS
CPA In Philadelphia on Monday, April 21, 2014 5:10 AM
These are most valuable information regarding audit process.
Reply to comment

Insight CA Ltd on Wednesday, August 10, 2016 1:00 PM
Looking good and very interesting to read! We are looking forward to seeing in person one day
Reply to comment

olymptrade on Tuesday, May 22, 2018 4:53 PM
I needed to thank you for this phenomenal read!! I unquestionably adored each and every piece of it. I have you bookmarked your site to look at the new stuff you post.
Reply to comment

resume planet review on Saturday, June 02, 2018 7:30 AM
Some of your article here really got me confused. But I enjoyed reading your article, I found a lot of new ideas. Thanks for sharing with us!
Reply to comment

nightrush on Monday, July 09, 2018 12:46 PM
On the off chance that it's your first time to put bet on MLB baseball wagering, there are top tips that you need to know in ready to get destined for success.
Reply to comment

national championship Live Stream on Wednesday, December 19, 2018 6:50 AM
The show will be lengthy, as it will run for four hours on ESPN. 30 minutes into the show, the final four teams will be set. This year, the two national semifinal games will be the Orange Bowl and the Cotton Bowl. Those two games will be held on Saturday, Dec. 29. College football Playoff 2019 Live Stream Two hours into the show, the entire Top 25 rankings will be revealed. This will include teams ranked No. 7 to No. 25. Before ESPN wraps it all up, the four remaining New Year’s Six bowl games will be announced. For the 2018 NCAA season, those four games are the Fiesta Bowl, the Peach Bowl, the Rose Bowl and the Sugar Bowl.
Reply to comment on Monday, December 31, 2018 2:23 AM
You have provided good information. I would love to read more on such topics. Thank you very much for it and carry on it.
Reply to comment

Kris Thorkelson on Tuesday, January 08, 2019 4:33 AM
Kris Thorkelson Myplace have been shipping the medicines and drug for the people that really need in entire Canada and across each city over the United States of America. They have the best set of staff that can deliver you the most sacrificed services for your health situation.
Reply to comment

4 part Receipt Forms on Friday, January 11, 2019 5:34 AM
I was looking for something like this ,Thank you for posting the great content .I found it quiet interesting, hopefully you will keep posting such blogs…
Reply to comment

drama wiki on Sunday, January 20, 2019 11:45 PM
I enjoy a couple of from the Information which has been written, and particularly the comments posted I will definitely be visiting again
Reply to comment

symond on Friday, March 08, 2019 8:29 AM
Very well written article about new year.I must say you have shared very useful information which i like reading.Keep up your good work. garage flooring
Reply to comment

Hacey on Friday, March 08, 2019 9:10 AM
This is very good article you have shared with us. I am very happy to read this. Carry on sharing good information with us.
Reply to comment

Amey on Friday, March 08, 2019 10:10 AM
I’m Really Impressed With Your Article, Such Great & Usefull Knowledge You Mentioned Here.
Reply to comment

Add a Comment

Your Name:
Email Address: (Required)
Make your text bigger, bold, italic and more with HTML tags. We'll show you how.
Post Comment
Website Builder provided by  Vistaprint