Expat Taxes: Being Audited

The “A” word – I’m being AUDITED, now what?!

The “A” word may be in the top 10 of scariest words ever!

Am I in trouble? Was I flagged? Not necessarily. Some reasons your return could be picked for an audit include: random sampling, computation errors, computer screening, excessive deductions, and large charitable contributions. Respond as quickly as possible. Ignorance is not bliss! If you ignore the notice, the IRS will not go away. Keep in mind, the audit process can be a lengthy one for people living abroad, so be patient.

Do not panic. If you have good records to substantiate your information and are honest, an audit should be of little concern.

Be organized. Ordinarily, you are asked to support specific items reported on your return. Have all of your original documents organized by each item called into question. However, there is no need to provide more information than what was requested of you.

Be polite. The old saying, “you catch more bees with honey…” may apply. No need upsetting the IRS agent that is reviewing your information.

Contact a tax professional. If you prepared your own return, you should contact a tax professional to see if your return was properly prepared. If not, they can help you deal with the IRS and solve the issue reasonably. If you choose, your tax professional can deal directly with the IRS agent on your behalf.