What is an "audit"?

What is an "audit"?

Every taxpayer is very much afraid of an IRS audit. It's looked upon as a horrible thing, and rightly so, because the purpose of the audit is to get additional funds from you. Even if you have all your receipts and all your documentation and you go there by yourself, the tax auditor is going to tell you some things that may not be 100 percent in-keeping with the way the rules are.For example, let's say you have unreimbursed automobile expenses because you use your car for work. You would go the audit and say, "These are my automobile expenses." They're going to say, "Well, do you have a log of each day, where you drove and how many miles it is?" And you'll say, "No, I don't have a log. I don't keep track of that." Then the auditor will tell you, the uninformed taxpayer, "I'm sorry. Section 274 says that it's not deductible. We're not going to allow you any of it." Whereas if you were represented by a tax preparer, the tax preparer would argue that there's other ways of proving the mileage that you drove and that it would be deductible. I would strongly advise every taxpayer not to go by themselves to an audit.