Just the idea of an audit is enough to make one’s head spin. But for a small business owner, the process can cause more than just a headache—it can cost you your business.
But tax professionals say an audit does not have to be a negative experience. The ideal audit is supposed to be a learning experience, says Nicole Gould, an attorney with Breazeale, Sachse & Wilson. In fact, you can control the process.
With so many parts to the audit process, how should a small business prepare if the Tax Man comes knocking? Business Report asked local corporate tax attorneys and consultants the secrets for surviving an audit.
Their collective advice: Stay calm, get organized and be nice. Otherwise, your auditor could become your worst nightmare. If your first reaction to an audit notification is panic, a bumpy road may lie ahead. Also, without a basic understanding of your tax obligations as a business owner and without proper preparation before the audit process begins, you could be faced with a very invasive audit from the IRS or the state.
“First thing you have to do is nail down the type of tax being audited. You need to nail down the tax periods that they are auditing and which specific person or taxpayer entity is being audited,” Gould says. Read the full feature. Send your comments to editors@businessreport.com.
