By Teresa Araque
LAWRENCEVILLE, Ga. | You’ve filed your taxes, paid what you owe—or you’re waiting for that refund to hit your bank account. Some time down the road, a letter arrives from the Internal Revenue Service (IRS) saying you’ve been selected for an audit.
Take a breath.
Benjamin Akins, professor of legal studies and taxation at Georgia Gwinnett College (GGC), says: “Read the letter. The letter will have all sorts of information about why you’ve received the letter, who the letter is from and a number you can call if you want to talk to someone to get more information. The IRS will never call you because they always begin the process by mail.”
The letter, Akins said, will help you figure out what you’re dealing with. “Is this a small, quick correspondence audit? Is this something more involved like an office audit or is this a really involved field audit?” he says.
Akins finds: “There are three kinds of audits. There’s one that is very limited and not too intrusive called a correspondence audit and that’s just the IRS wants to send letters back and forth with you about something very specific about one of your returns. It’ll usually go away with just a couple of mailings back and forth.”
The second, he added, is an office audit. “This is when the IRS says they need you to come into one of their local offices and have a conversation with them, which is a little scarier, but it’s still fairly limited in what they’re looking for.”
The third audit, Akins said, is the field audit. “This is much more serious and is used only in certain situations. For instance, it might be necessary in a situation where the auditors need to get a feel for how the business is actually operating. Coming to the taxpayer’s location might be the only way to get the full picture.”
What could trigger an IRS audit? Akins said that things like very large deductions, such as charitable donations or business expenses can trigger an audit. Also, something called information mismatching can get the IRS’s attention. “Remember that the 1099 and W2 forms that you receive are also sent to the IRS,” says Akins. “If the information from those documents and what you file don’t match, it can trigger an audit.”
Once you have received and read the letter from the IRS, Akins said there are steps you should take right away. “Start gathering your records. One thing people need to know is that audits are not accusations that you’ve done something wrong,” he says. “They’re just requests that you verify things that you voluntarily told the government. We have a voluntary compliance tax system where the government just takes our word for what we say and occasionally they have questions. Audits are just their way of asking questions and wanting a few quick tips for taxpayers.
“Keep good records, and the conventional wisdom is to keep your tax records for about seven years,” he said. “The IRS has three or so years to audit most returns. So, if you file your 2025 return in April of this year, the IRS will likely have until April 2029 to audit that return.”
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