An IRS audit can sound intimidating, but for many small businesses, it’s more of a formality than a nightmare—especially if your records are in order and you’ve got support from a knowledgeable team like ours.
At Aretera Corporation, we help businesses navigate audits with confidence. Whether you’ve received a notice or just want to be prepared, here’s what you should know.
What Triggers an IRS Audit?
The IRS selects tax returns for audits based on a few common triggers:
- Large or unusual deductions relative to income
- High cash-based business income
- Mismatched reporting (e.g., 1099s or W-2s don’t align with your return)
- Self-employment or freelancer returns without sufficient documentation
- Random selection—yes, some audits are just luck of the draw
An audit doesn’t necessarily mean something is wrong, but the IRS wants to verify that your tax return is accurate and complete.
Types of IRS Audits
There are three main types of audits:
- Correspondence Audit – The most common and least invasive. The IRS requests clarification or documentation by mail.
- Office Audit – You’re asked to visit a local IRS office with records for review.
- Field Audit – An IRS agent visits your place of business. These are more detailed and less common.
Regardless of the type, our team is equipped to guide you every step of the way.
What to Do If You Get an Audit Notice
If you receive a letter from the IRS:
- Don’t panic. Stay calm and read the notice carefully to understand what’s being requested.
- Gather your documents. This may include receipts, bank statements, ledgers, or explanations of business expenses.
- Contact us immediately. The sooner we get involved, the smoother the process will be. We’ll review the notice, prepare your documentation, and handle communications on your behalf.
How to Be Audit-Ready Year-Round
The best way to approach an audit is to always be ready for one. Here’s how:
✅ Keep Detailed Records
Maintain organized, consistent documentation for income and expenses. This includes:
- Invoices and receipts
- Mileage logs
- Bank statements
- Payroll records
- Contracts and agreements
We recommend using QuickBooks Online, which allows us to help you manage your books in real time and ensures everything is backed up and categorized properly.
✅ Stay Current on Filings
Avoid late filings and payments. Missing deadlines is a red flag. If you’re unsure about a deadline or requirement, we’re here to help you stay on track.
✅ Avoid Red Flags
If you deduct 90% of your income as business expenses or report unusually low profits, the IRS may want to take a closer look. That doesn’t mean you shouldn’t claim legitimate expenses—but documentation is key.
When you’re working with our team, we review your returns and bookkeeping to ensure accuracy and defendable entries.
Our Role in Audit Preparation
We don’t just help during the audit—we help you prevent issues before they happen. Here’s how we support clients through the audit process:
- Pre-audit file review to ensure all required documentation is in place
- Representation and communication with the IRS on your behalf
- Clarifying deductions and defending business expenses with proper backup
- Correcting or amending returns if necessary
Whether you’ve been contacted by the IRS or just want peace of mind, we’ve got your back.
Need Help? Let’s Talk
Facing an audit doesn’t have to be stressful. With the right preparation—and the right partner—you can move through it confidently and efficiently.
📞 Reach out and schedule a consultation today for help preparing for an audit or to proactively review your financials. We’re here to help you feel confident, supported, and secure.
Disclaimer:
The information provided in this article is for general informational purposes only and is not intended as professional advice. Our firm makes no guarantees about the accuracy or applicability of the information. For specific advice related to your situation, please contact us directly. We are not liable for any decisions made based on the content of this article.
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