Compile all of the tax documents you usually receive in late December or January to show all your income and other tax information for the year. These documents may include:
W-2s from your employers
1099-MISC forms for self-employment income
K-1 forms for income from a partnership, small business or trust
1099-SSA form showing Social Security received
1099-INT (interest) and 1099-DIV (dividends) forms
1099-B forms showing brokerage trades in stocks and bonds
If you have additional income not reported on a W-2 or 1099 form, such as income from rental properties, other self-employment income, or alimony, you’ll need written documentation of that as well, which could include a spreadsheet, bank statements or other written evidence.
If you’re not sure if something qualifies as a tax-related expense or if you have questions, go ahead and bring canceled checks, receipts or spreadsheets, and we’ll help you figure it out. This may include contributions to your traditional or SEP-IRA, moving expenses, college expenses, medical and dental expenses, real estate taxes, gifts to charities and churches, and childcare costs. In some cases, you may receive an annual statement regarding some of these expenses that you can bring with you. Mortgage interest, for example, is reported to you on form 1098, and student loan interest is reported on form 1098-E.
If you paid estimated taxes, you’ll also need to provide us with a summary of your federal and state estimated payments and canceled checks. We have a great tax organizer we’d be happy to provide to help you keep everything organized and ensure you haven’t forgotten anything relevant for you or your family members.
First of all, don’t panic. As your trusted financial partners, we’re here to guide you through the entire process and protect your best interests. As soon as you receive the notice, give us a call, and we’ll work through it together.
The first step will be to take a careful look at the specifics of the notice. Understanding what the IRS is asking for ensures we’re well prepared. Some audits involve only parts of a single year’s tax return, while others can include entire returns for multiple years. We may need to just mail the IRS some additional information, or we may be required to meet with an IRS agent. We will be happy to accompany you to any meeting with the IRS.
You might be tempted to avoid dealing with the stress and put off your response to the audit notice, but that will only make things more challenging. The sooner we can help you begin to pull your information together, to request information from others, such as charities, credit card companies, and banks, the sooner we’ll be able to resolve the issue.
You may be asked to provide:
Bank statements and cancelled checks
Print-outs and digital copies of electronic records and logs
Appointment books, calendars and/or journals
Worksheets showing your calculations for each item
An extra copy of all documentation
Once you’ve located all of the requested information, we’ll help you organize it to make the IRS agent’s job easier and to help speed the audit process.
When the time comes to respond, we’ll help you deliver the information in the most appropriate way with regard to the requirements of the audit request. We can accompany you to any meeting, or in some cases, may be able to represent you without your attendance. If you need to respond by mail, we’ll help ensure all of the proper documentation is included and all copies and records are made and filed for you.
Once you receive the results of the auditor’s findings, we can help you process any additional requirements. You may have to pay an additional amount to the IRS, return part of a refund, or you may receive money back. You also have the right to appeal the IRS agent’s findings to a supervisor or the IRS Appeals Division, and you can take your case to the U.S. Tax Court, again with our expert team right alongside you for support.
Congratulations on your decision to launch a new business! Let Hayes & Associates get you started on the right foot by helping you lay a strong financial foundation. We can help you navigate the new business process. Please call us for more information, because we love working with new business owners!