Most of the time, the IRS accepts tax returns as you file them. However, it selects some for an additional review or audit to determine if you reported your income, expenses, and credits accurately.
If the IRS selects your return for audit (also called examination), it doesn’t automatically mean something is wrong. Once the IRS completes the examination, it may accept your return as filed or propose changes. These changes may affect the amount of tax you owe (a proposed deficiency) or your refund amount.
There are two ways to be audited – by mail, or in person. This article deals with an in-person audit.
When the IRS selects your tax return for audit, it will notify you by mail. Sometimes the IRS will follow-up with you by phone about the notice it previously sent. The notice will tell you:
What part of your return is being examined;
The information you need to provide; and
Other details about the audit.
The examination may take place in your home, your place of business, an IRS office, or the office of your attorney, accountant, or enrolled agent (a person enrolled to practice before the IRS). If the time or place on the notice isn’t convenient for you, the examiner will try to accommodate you.