If you are contacted by the IRS or other tax agency, James can provide you consulting. Audit notices are always sent out by mail, so don't trust anyone who tells you over the phone that you owe money to the IRS or state. Before taking action, please email or fax me a copy of the notice. I will look it over at no charge and let you know what your options are. While I am not set up to make phone calls to the tax authorities on your behalf, or accompany you to in person meetings, I can help you prepare written responses, and advise you about what documentation to gather. I can also tell you what additional steps you may have to take. If it turns out that you have a very serious or advanced case, you may want to hire a tax lawyer.
As with all consulting, my billing rate is $300 per hour, with a minimum of $75 for 15 minutes. The tax agency will often focus on one or two issues and make a proposed adjustment disallowing them. In some cases, a letter explaining your position and/or providing persuasive documentation may be enough to have the adjustment reversed. Other times, it may be a full examination or audit.
If you receive a notice of a tax adjustment, be sure to email me a copy before making a payment. Unfortunately, every year I see notices with mistakes made by the IRS or state. Never pay a bill if you don't fully understand why you owe the money. The most likely reason for the adjustment is that income was left off the tax return that was reported to the IRS. For instance, perhaps you forgot to provide me with one of your tax forms, or it was received late or not at all. I always review notices free of charge.
While audit rates are low in general, in recent years, I have noticed that the following types of tax returns to be more likely to be audited:
Higher income earners ($500,000+).
Self employed (filing Schedule C) with business expenses more than 50% of gross income.
Tuition as an employee business expense (e.g., MBA deduction).
Expatriates with high income living near London or Paris.
Nonresident aliens filing Form 1040NR who are able to exclude a lot of income as foreign source.