They are:Ĭorrespondence audit (conducted entirely by mail) They are always initiated via mail and never by telephone, email, or social media. There are three kinds of tax audits that can be requested. However, if you have multiple problems with your tax returns, missing returns, or missing documentation, or if you have not kept business tax returns for the required period along with detailed records of business expenses and income, your fees are likely to be much higher. If your bookkeeping is meticulous and your tax return was selected at random, the audit process should be simple and quick and your audit representation fees should sit at the lower end of the range. The IRS has reason to suspect that you had unreported income in a previous tax year.
You have missing or incomplete tax returns. Many of the figures on your tax return ended in 0 or 5. Your reported income was substantially higher or lower than it was in other years. You claimed a large number of deductions or charitable contributions on your return.
There are many possible reasons that you could be audited by the Internal Revenue Service, including anomalies on your tax return and simple random selection. Factors That Affect the Cost of Tax Audit Representation The Reason for the IRS Tax Audit It may go even higher if your case goes to the U.S. If charged as a flat fee, your total tax audit representation cost could be anywhere between $2,500 and $10,000 per tax year under examination. These are just industry averages and can vary based on numerous factors. For a highly experienced tax attorney in a big-city firm, you could be looking at an hourly rate of $1,000 or more. The Average Cost of Audit Representation (Ballpark Figures)Īs an industry average, the hourly rate for IRS tax audit services starts at around $150, with $200 to $400 being a common range. Generally, flat fees will be charged for straightforward cases whereas hourly fees will be charged for complex cases that may require a lot of additional work. Audit representation fees can be charged either as an hourly rate or a flat fee. The cost of representation for an IRS tax audit varies significantly depending on the complexity of your case and the experience and qualifications of the person representing you.
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