If you receive an audit notice from the IRS, you need to acknowledge it and respond promptly. If you had your taxes prepared at Jackson Hewitt, then you should contact your local office before sending information or additional money to the IRS in response to an audit notice. The IRS may have made an error in the amount they state you owe and the audit item may require the knowledge that only your tax professional can provide.
How Are Returns Chosen for Audit?
Returns that are examined are chosen either by computerized screening, by random sample or by an income document matching program. There are circumstances that may cause the IRS to examine your return more closely. For example, the IRS may request more information if your itemized deductions are very high or if you claim tax shelter losses. Your tax return may also be selected for examination on the basis of information received from third-party documentation, such as a Form 1099 or a Form W-2, that does not match the information reported on your return. You may also be selected to address the questionable treatment of an item on your tax return. If your business expenses or charitable contributions of cash are substantial in relation to your income, you may receive an audit notice. Many examinations result in a refund or acceptance of the tax return without change, but some may result in a change in tax liability.
The Examination Process
The IRS audit notice may either require you to attend a subsequent meeting in person or to send additional information by mail. You may choose to have Jackson Hewitt assist you during your audit. A representative will appear with you at an audit, at no charge, to explain how your tax return was prepared. Jackson Hewitt cannot act as your legal counsel, financial advisor or otherwise represent you in connection with an audit.
If the examination results in a change to your tax liability, you may want the IRS to reconsider your case. The IRS may reconsider your case if you are submitting additional information that could result in a change to the additional amount they determined that you owe, you are filing an original delinquent return after they determined that you owe an additional amount, or you have identified a mathematical or processing error they made. You should gather copies of your records, tax returns, and canceled checks, and any other necessary information to support your case. Your reasons for disagreeing cannot be based only on moral, religious, political, constitutional, conscientious, or similar grounds.
If you cannot reach an agreement regarding the proposed changes to your tax return, the IRS may send you Letter 525, General 30-day Letter, notifying you of your rights to appeal, a copy of the tax examiner's report and an agreement or a waiver form. If you do not respond to this letter, or if you still do not reach an agreement with the appeals officer, the IRS will send you a Letter 531, Notice of Deficiency. You have 90 days from the date of this notice to file a petition with the Tax Court. If you do not file this petition, you will receive a bill for the amount due. Please consult your local Jackson Hewitt Tax Service office for more information.
Innocent Spouse Relief
If you filed a joint tax return, you are jointly and individually responsible for the tax and any interest or penalty due on the joint return, even if you later divorce. In some cases, a spouse may be relieved of the tax, interest, and penalties on a joint return. You can request relief no matter how small the liability. Three types of relief are available:
- Innocent spouse relief - This may apply to all joint filers.
- Separation of liability - This may apply to joint filers who are divorced, widowed, legally separated, or have not lived together for the past 12 months.
- Equitable relief - This applies to all joint filers.
Innocent spouse relief and separation of liability apply only to items incorrectly reported on a joint tax return. If a spouse does not qualify for innocent spouse relief or separation of liability, the IRS may grant equitable relief. Each type of relief is different and each has different requirements. You must file Form 8857, Request for Innocent Spouse Relief, to request any of these methods of relief.
Jackson Hewitt Tax Service office provides free audit assistance for customers for whom we prepared returns. Contact your local Jackson Hewitt office for more information or assistance. Use the Office Locator feature available on this Web site or call 1-800-234-1040 to find the Jackson Hewitt location most convenient to you.