First Audit follow-up

[oceanlovin'ea]

I decided to follow the advice of some of you who suggested that I find someone who does representation and turn the audit over to them to do.
After I spoke to the IRS agent, I realized that she was really going to dig BIG TIME. She even was requesting the manifests that he sends to the company he has contracted with for delivery, even though he has a 1099 from them.
The client brought me receipts....none of which added up to the figures he gave me for the tax return. When he brought his bank statements, I saw that he had opened a bank account in the corporation name about half way through the year.
I will be out of town for at least 9 days this month which would make getting the all together very difficult.
The client lives in another town about 30 minutes away. So I called an EA in that area and asked if she did representation. She doesn't anymore. She gave me the name of an ex-IRS examiner that she has used for representation for audits. So I called him. He was very pleasant and seemed to be very knowledgeable.
So he will handle the audit.
My client was a little shocked at the cost of representation. I was so concerned about getting all the information needed that I didn't discuss the cost with him when he brought me his receipts. (That was bad) But I told him I would have charged him the same hourly amount. I also told him that I wanted him to have the best representation he could get and that this man had the experience to represent him well.
I did add up the receipts that he had brought me and tried to have a lot of backup work done before the other gentleman took over. Told him I would charge him bookkeeping charge for doing that.
I sure hope it goes well. I know that I will have to do my own representation at some point. But his was more complicated than I was comforable handling now.
Thanks for all your good thoughts and suggestions.

Linda F

[Gretel]

Thanks for letting us know.

[BHoffman]

Hi Linda - betcha felt immense relief turning the representation over to an experienced ex-IRS pro. I sure did!

I do not intend on representing any client for field audits - ever. IMHO, that service is extremely specialized. It's difficult to get the hands-on experience because audits are not frequent (thank heavens!).

Just because I have the credentials to represent clients doesn't mean I am interested in getting good at it. I have more productive and interesting things to do than hassling with IRS auditors.

My point is that it doesn't reflect badly on our abilities and talents if we choose not to get the experience and knowledge necessary to represent clients before the IRS in field audits. That is a completely different area than tax preparation and/or accounting. I believe in letting the specialists do their job, and I can focus on my areas of specialization, knowledge, experience, and most of all - interest.

[BOB W]

While I can understand your reluctance to be a rep, I have never hesitated in doing so. If you did represent a client and during the audit somethig is going BIG TIME wrong you can always call in the BIG BOYS/GIRLS. Just tell the auditor you want to stop and reschedule for another time.

Inform your client that there are issues that need to be addressed by another tax rep.

I have always had a good relationship with auditors and never ran into anything that couldn't be worked out. The client may of owed some or got a little back or rec'd a no change. In any case, the audit was never a big deal.....Time consuming> Yes...

An audit is nothing more than a meeting of the minds. If you are not sure, tell the auditor you will have to review that and get back to him/her on that.

NOW, if you know there is a big problem that has come up during the pre-audit with your client, you need to let your client know at that time. This will prepare your client for the end result. If your client says he is not happy, then send him to another Rep.