Hiring a CPA during an audit makes sense

It’s everyone’s worst nightmare, you open the mail and there is an audit notice from the Internal Revenue Service. Audits can be rough and agents are quite thorough. They will require seeing any bit of information. If you didn’t hire a CPA to do your taxes before, it’s not too late to get one. Just as you wouldn’t allow the police to question you without a lawyer, you don’t want an IRS agent to question you without a CPA. Trying to handle an audit by yourself is a daunting task and if you’re not skilled in tax law, you could get yourself into deeper trouble.

Recession Zombie

This man needs professional help from a CPA. Recession Zombie by Bob Jagendorf, on Flickr

CPAs possess a unique skill set and education. They are one of the most educated and tested professions in the world and are held to strict ethical standards. It’s best to have a CPA manage your finances from the start, however that can’t always be the case and sometimes it’s necessary to hire a CPA once you receive that audit notice.

A CPA will represent you during the entire audit and can limit your risk exposure. Additionally, because these laws are subject to interpretation, a CPA can fight on your behalf to limit the scope of the audit and the amount of information provided.

Hiring a CPA can reduce the burden on you and prepare you for what the IRS agent might look at. Additionally, a CPA can go to the IRS audit in your stead. An outside representative, like a CPA, will be less emotional and defensive when dealing with an IRS agent, therefore giving you a much better standing. IRS agents and CPAs speak the same language; as such they are playing on the same level and can negotiate the best deal for you.

Remember, just because you hire a CPA for an audit, doesn’t mean that you have to retain the same CPA, or any, for your regular accounting and bookkeeping services. Although it wouldn’t hurt. Actually, the probability of you being audited when using a CPA is quite slim. But if you are and the IRS agent finds something at fault with your filing when using a CPA, the CPA can be held liable for penalties and interest. CPAs are required to carry insurance for this particular reason.

If you decide against hiring a CPA, you will need to be on your toes. You increase the risk of the IRS agent asking questions you may not want to answer. Don’t forget, the IRS agent isn’t there to be your friend, no matter how they may act. The IRS agent’s ultimate goal is to determine what additional taxes you owe and the penalties associated with them. Save yourself the hassle up front and hire a CPA.

By Grant Webb with Bisk Education. Bisk provides many accounting services for Certified Public Accountants including CPA CPE and CPA Exam Review courses for aspiring accountants.

About Mark P. Holtzman

Chair of Accounting Department at Seton Hall University. PhD from The University of Texas at Austin. Worked at Deloitte's New York Office. BSBA from Hofstra University.

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