Guide to Surviving a Sales Tax Audit
Surviving a sales tax audit involves taking preventive measures. By preparing carefully in advance, a person can comfortably welcome an auditor to his or her business. The following six tips can help any business owner survive a sales tax audit.
Understanding What the Auditor Wants
Carefully reading the audit request can help a business owner understand what exactly the auditor wants. If he or she is having difficulty understanding the audit request, an attorney can read and explain it to him or her. The business owner should also know key factors that could get him or her into IRS problems, including underpaying taxes, late filing of taxes, and ignoring IRS inquiries.
Preparing Thoroughly Ahead of the Auditor’s Visit
A business owner should know that the auditor has a tight schedule and will appreciate his or her efforts in facilitating a fast and stress-free audit. He or she should predict and adequately prepare for potential questions and concerns that the auditor is likely to have. Pre-auditing the business is the best way to detect those potential concerns. Tax audit help from a tax attorney can also help a business owner get everything right ahead of the auditor’s visit.
Treating the Auditor with Respect
Treating the auditor as a collaborator rather than an enemy is important. The business owner should be well organized, gentle, polite, and professional. In simple terms, the business owner should treat the auditor the way he or she would want to be treated.
Giving Short and Clear Responses to the Auditor’s Questions
A business owner should avoid volunteering any additional information or documentation for the auditor to examine. Instead, he or she should provide precisely what the auditor requests. By providing substantiated facts with confidence, he or she will earn the auditor’s trust.
Simplifying the Audit Process
Designating one of the employees as an audit coordinator who will take all information and documentation requests from the auditor will significantly ease and speed up the audit process. Giving the auditor sufficient workspace is another effective way to make the process easier and faster.
A Business Owner Should Understand His or Her Rights under the Law
By knowing his or her rights, a business owner can approach the audit process with the utmost confidence. The business owner should, for instance, know that he or she is entitled to an audit reconsideration if he or she isn’t satisfied with the tax audit results.