Audit Engagement Letter



There are many reasons why a person may or may not receive an audit engagement letter
- something that many taxpayers and files greatly fear receiving each and every year, but
not necessarily something that is to be of great fuss. Certainly, if you are to receive such a
letter, it can be startling at first glance. Just knowing that you are getting audited can be a
very stressful experience for any person. However, this does not mean that it is the end of
the world. In fact, the chances of you getting an audit engagement letter are rather slim,
when you look at the overall country as a whole, and those who get such letters annually
from the IRS auditors that mail them out.



For example, according to the IRS, about one to two percent of all annual tax returns that
are filed are audited each year. Seeing as they only have so many resources, they can only
afford to audit so many people each year. Make sense? Secondly, for most purposes, they
are going after people who make so much per year, so if you are not in the six figure
bracket your chances are about one percent that you may or may not get an audit
engagement letter. That is some pretty low numbers, considering how many millions of
people file their taxes in the US each year. And if you do happen to find one in the mail,
take a deep breath first, because it is not the end of the world.

Reasons Why you May Receive One
There are many reasons why you may get such a notice in the mail from the IRS. Believe
it or not, most often people get audited because they made some simple errors on their tax
returns that need to be corrected. Many times this is able to easily be resolved via snail
mail correspondence with the IRS in order to solve the issue. Sometimes you may need to
meet face to face with them. Still, don't panic. Because it some cases they might have
screwed up and owe you money, or you may just not be getting that fat return you
expected. Worst case: you owe them and you can work out a payment plan that allows
you to easily pay them any back taxes that may or may not be due.