When The IRS Comes Calling

Do you have a plan if the IRS chooses to audit your business?
2 min read
Opinions expressed by Entrepreneur contributors are their own.

If the IRS selects your business to be audited, the best strategy is to cooperate-as quickly and efficiently as possible. Here are some other important steps to follow:

  • Hire a stand-in. Tax experts say it's best if you don't try to represent yourself. You can authorize an attorney, CPA or enrolled agent to represent you at the examination. Keep in mind that whomever you designate will need power of attorney to represent you.
  • Give yourself enough time to prepare. The IRS may try to pressure you into an early audit date, or an agent may even appear at your home or office and try to start the examination immediately. Don't let that happen. Tell them you need time to see your accountant and prepare. Set a date that gives you the time you need. That way, your accountant or attorney will have sufficient time to review your return and make sure you have the necessary receipts.
  • Don't volunteer information. If you decide to go it alone, answer only the questions asked. Provide only records that directly relate to the items questioned in your IRS notice to avoid opening yourself up to other areas of investigation.
  • Give them their space. If your business is selected for a field audit, be sure to give the IRS agent a work area that's set apart from employees. Select a "point person" in your business to deal with the auditor. This person should provide the necessary records, make copies and be a general contact for the auditor.

More from Entrepreneur

Get heaping discounts to books you love delivered straight to your inbox. We’ll feature a different book each week and share exclusive deals you won’t find anywhere else.
Jumpstart Your Business. Entrepreneur Insider is your all-access pass to the skills, experts, and network you need to get your business off the ground—or take it to the next level.
Starting, buying, or growing your small business shouldn’t be hard. Guidant Financial works to make financing easy for current and aspiring small business owners by providing custom funding solutions, financing education, and more.

Latest on Entrepreneur

Entrepreneur Media, Inc. values your privacy. In order to understand how people use our site generally, and to create more valuable experiences for you, we may collect data about your use of this site (both directly and through our partners). By continuing to use this site, you are agreeing to the use of that data. For more information on our data policies, please visit our Privacy Policy.