How Can You Prepare for a Successful Tax Audit Defense?
Getting a notice from the IRS that you’re being audited can cause immediate stress and confusion. It's normal to feel overwhelmed, uncertain, or even scared. You may be wondering why you were selected or what the consequences might be.
The idea of having your finances picked apart can feel invasive and frustrating, especially when you’ve tried to be diligent and responsible. We get it—this is more than just paperwork. It’s your livelihood, your peace of mind, and your financial stability on the line.
At Common Law PC, we’ve worked with many clients in Salt Lake City and the surrounding areas who have gone through the same experience. If you're facing an audit, you don't have to handle it on your own.
Reach out to our Utah tax audit attorney today if you’re preparing for a tax audit or already facing one. We're ready to help.
Know Why You’re Being Audited
Before anything else, it’s important to find out why the IRS or Utah State Tax Commission flagged your return. There are many reasons audits happen, and not all of them suggest wrongdoing. Some are simply the result of random selection or inconsistencies that triggered a review.
Some common reasons audits are triggered include:
Mathematical errors or mismatches: If your reported numbers don’t match what your employer or bank submitted.
High deductions or losses: Unusually high business expenses, charitable donations, or reported losses may raise questions.
Cash-heavy businesses: Businesses that deal mostly in cash, like restaurants or salons, tend to be audited more often.
Related-party transactions: Payments or loans between family members or closely held companies can be scrutinized.
Large income swings: Significant changes in income can catch attention, especially without clear explanation.
Once you understand the reason behind your audit, you’ll be better equipped to focus your preparation and avoid unnecessary stress.
Organize All Relevant Financial Records
One of the most important things you can do to prepare for a successful audit defense is to gather and organize your financial documents. Auditors want to see that your reported income, deductions, and expenses are backed by clear, consistent records.
Some items to organize before the audit include:
Tax returns and amendments: Have copies of your filed returns for the year(s) in question.
Receipts and invoices: These should support claimed deductions, especially for business expenses or charitable contributions.
Bank and credit card statements: These help verify income and track expenses.
Mileage logs and travel records: If you claimed vehicle or travel deductions.
Payroll records: For business owners, this helps support wage deductions.
Correspondence with the IRS: Keep any notices or letters related to your audit in one place.
Once you’ve gathered your records, review them for accuracy. Make notes if anything is missing or hard to explain. An experienced tax audit attorney like Mike Black can help you identify red flags and prepare explanations before you sit down with the auditor.
Don’t Speak to Auditors Without Representation
It’s never a good idea to handle an audit on your own, especially if the questions go beyond simple paperwork. The IRS is trained to ask questions that may seem casual but are actually meant to uncover discrepancies or wrongdoing.
A tax audit attorney like Attorney Mike Black will:
Protect your rights: You’re not required to answer every question on the spot, and you shouldn’t.
Limit what’s disclosed: A lawyer helps you avoid giving too much information that could be misunderstood.
Prepare your responses: You’ll know what to say and what not to say.
Reduce stress: You won’t feel as pressured or caught off guard during meetings.
Negotiate outcomes: If penalties are proposed, your lawyer can often help reduce or eliminate them.
Having a tax audit attorney like Attorney Mike Black by your side not only helps keep the audit focused but also shows the IRS that you’re taking the process seriously. That can make a big difference in how the audit is handled.
Stay Honest But Cautious
During an audit, honesty is critical—but so is discretion. It’s important to provide accurate information without volunteering extra details that aren’t required or helpful.
What to keep in mind when responding:
Answer only what's asked: Avoid expanding beyond the question.
Be consistent: Make sure your verbal answers match your records.
Don’t speculate: If you don’t know something, say you’ll follow up.
Document your answers: Keep notes of what was said or requested.
Auditors are trained to notice inconsistencies, even if they’re unintentional. That’s why having your lawyer respond on your behalf—or at least prepare you for the conversation—is a smart move.
Prepare for Different Audit Formats
Not all audits look the same. Depending on your situation, your audit might happen by mail, over the phone, or in person. Knowing what to expect can help you get ready.
Types of IRS and state tax audits include:
Correspondence audits: Handled entirely by mail. You’ll be asked to send in specific documents.
Office audits: You’ll be asked to bring documents to a local IRS office.
Field audits: The auditor comes to your home or business. These are usually more detailed.
Each format has different expectations and levels of scrutiny. A field audit, for instance, often involves a closer look at business operations, while a correspondence audit is usually more limited in scope.
Attorney Mike Black and our firm at Common Law PC help clients prepare for all types of audits, including reviewing materials, prepping for interviews, and attending meetings with you or on your behalf.
Watch Out for Common Audit Pitfalls
Even well-intentioned people make mistakes that can hurt their audit outcome. Knowing what to avoid is just as important as knowing what to do.
Frequent mistakes during audits include:
Guessing or estimating figures: Always use actual documents, not rough numbers.
Throwing away old records: Keep records for at least seven years.
Overexplaining deductions: Keep your explanations factual and concise.
Disorganized presentation: A pile of unlabelled receipts won’t help your case.
Neglecting to respond: Missing deadlines or ignoring auditor requests can escalate your case.
The more prepared and precise you are, the easier it is to defend your tax return. It also helps reduce the chances of the audit expanding into other years or areas of your finances.
Know Your Options if the Audit Doesn’t Go Your Way
If the audit results in additional taxes, penalties, or interest, you don’t have to accept the outcome without a second look. There are ways to challenge or appeal the auditor’s findings.
Options after an audit determination:
Request a meeting with the auditor’s manager: This can sometimes resolve issues without a formal appeal.
File an appeal with the IRS Office of Appeals: This is a separate division that reviews audit decisions.
Petition the U.S. Tax Court: If necessary, you can take the matter to court, where a judge will review your case.
Working with a tax audit attorney throughout the process makes these steps much more manageable. At Common Law PC, we assist clients in Salt Lake City, Park City, Provo, Ogden, and St. George with post-audit appeals and negotiations, often leading to reduced penalties or reversed decisions.
Speak With a Skilled Tax Lawyer
Facing a tax audit doesn’t have to mean fighting alone. With preparation, organization, and the right guidance, you can protect your financial interests and avoid unnecessary penalties or stress. Whether your audit is simple or more involved, having legal support can make a lasting difference in the outcome.
If you’re in Salt Lake City, Park City, Provo, Ogden, or St. George, we encourage you to speak with our tax audit attorney at Common Law PC.
Attorney Mike Black has years of experience guiding individuals and business owners through the audit process, helping them respond strategically and confidently. With the right preparation and representation, it's possible to come out the other side of an audit without disruption or penalties.
Whether you’re just getting started or you’re already deep into the process, we’re here to help you move forward with a clear strategy. Reach out to us today to discuss your situation and get started on building a strong tax audit defense.