“We’re being audited by the IRS.”  These words strike fear into the hearts of many law-abiding citizens.  Many questions begin racing through taxpayers’ minds: “Am I going to prison?”  “Will the IRS take my house or bank account?” “What will the IRS find?”  “How much do I owe?”  “Do I need help?” and “Where can I go for help?”

These are all common, and understandable, questions. While no tax controversy attorney can provide the answers to these questions until meeting with a client and thoroughly reviewing their situation, the trusted Scottsdale IRS audit lawyers at Kaczmarek & Jojola can certainly help with an IRS audit.

Attorney discussing IRS audit to his client in Scottsdale

Both Attorney Kaczmarek and Attorney Jojola spent years working for the IRS as senior trial attorneys. Attorney Kaczmarek was selected to be an instructor for the Advanced Fraud & Forensic Accounting Program that teaches revenue agents to handle fraud audits.  In addition, he frequently advised IRS agents on challenging audits and the development of cases. Attorney Jojola spent more than a decade managing a heavy caseload of complex tax cases in front of the United States Tax Court. He also advised IRS agents and officers in complex audit, innocent spouse and collection matters. These experiences provide Attorneys Kaczmarek & Jojola with an in-depth knowledge in tax audit matters, which we unceasingly use to help our clients achieve the best possible results.

What Triggers an IRS Audit?

The IRS can audit a tax return for any reason. Sometimes, the IRS will randomly select a return for an audit. However, typically, the IRS will audit a return if it believes something contained in a tax return is out of the ordinary. The goal of an IRS audit is to reduce the “tax gap,” or the difference between the amount the IRS is owed and what the IRS ends up with at the end of tax season.

Below are a few of the most common reasons why the IRS conducts an audit of a tax return:

  • Failure to report income – The IRS receives copies of all W-2s, K-1s and 1099s from employers. Thus, the IRS knows about a taxpayer’s income, even if the taxpayer does not report it.
  • Making a mathematical error – The IRS assumes that taxpayers either have a professional prepare their taxes or that the taxpayer accurately prepares their own return. Thus, taxpayers who make simple errors in their arithmetic risk an increased chance of an audit.
  • Deducting too many business-related expenses – Self-employed taxpayers can deduct certain business expenses on a Schedule C. However, reporting too many expenses as well as business losses can raise a red flag.
  • Claiming excessive charitable donations – The IRS tends to look not only at the dollar amount of charitable donations, but also at the ratio between the charitable contribution and the taxpayer’s income.
  • Taking a home office deduction – It used to be that the IRS would routinely scrutinize home office deductions. While that is not the case any longer, taking large home-office deductions may increase the risk of an audit.
  • Using round numbers – The IRS allows taxpayers to round numbers to the nearest dollar. However, the consistent use of even dollar amounts throughout a return, such as $500 instead of $497, may raise suspicions.

What Does an IRS Tax Audit Look Like?

Law firm handling IRS Audit cases in ScottsdaleAn IRS audit is a review of a tax return to verify that the taxpayer correctly reported their financial information and paid the appropriate amount of tax. In general, there are three types of IRS audits: field audits, office audits, and correspondence audits.

Field audits: As the name suggests, a field audit takes place at the taxpayer’s home or place of business.  The scope of a field audit is generally broad.  In these cases, to the extent permitted, we insist the IRS performs the audit at our office rather than our client’s office.  This generally reduces the stress associated with the audit, minimizing awkward questions and concerns of employees and clients.

Office audits: An office audit occurs in a local IRS office. Most often, office audits are limited to a few selected items.  In these audits, we initially determine the issue or issues under audit. Once we understand the nature of the audit, we will work with our client to collect all necessary documentation and then develop an effective strategy to deal with the audit.

Correspondence audits: Correspondence audits are the lowest level of audit conducted by the IRS and occur entirely through the mail.  However, if the matter becomes more involved, or the taxpayer fails to respond to a correspondence audit, the audit may escalate to an in-person audit.  In a correspondence audit, the IRS sends a detailed letter requesting additional information or documentation. In many instances, we are able to draft a careful and attentive response that will swiftly limit or conclude the audit.

Typically, IRS audits can include returns filed within the last three years. However, if the IRS notices an especially troubling error, it may go back further. Regardless of the type of audit a taxpayer is facing, enlisting the assistance of a knowledgeable tax lawyer can ease the stresses that naturally arise throughout the tax audit process. In addition, a tax controversy lawyer can help taxpayers prepare for the audit, potentially narrow its scope, and ultimately help the taxpayer work towards a favorable result.


If you have been notified that you are being audited by the IRS, let our experience work for you. At Kaczmarek & Jojola, we have extensive experience helping individuals and businesses through all types of tax audits. Our knowledgeable Arizona tax controversy attorneys can help guide you through this stressful process, providing you not only with effective representation, but also with invaluable peace of mind. To learn more, contact Kaczmarek & Jojola today by phone or through our online form.