By Maureen Renzi, Vice President - Communications
An IRS audit of your taxes can be a nerve-racking experience. It is something you do not want to enter into on your own. But who can stand beside you, or for you, in front of the IRS? Can a certified public accountant (CPA) represent you, a client, during an IRS audit? According to Julius Green, CPA, president of the Pennsylvania Institute of Certified Public Accountants, the answer is simple: yes. CPAs are specifically identified by the IRS as professionals permitted to represent their clients before the IRS. According to Circular 230, which is the IRS document defining tax preparation regulation, CPAs may:
- Communicate with the IRS on behalf of a taxpayer
- Represent a taxpayer at conferences, hearings, or meetings
- Prepare, file, or submit documents
- Provide clients with written tax advice on one or more federal tax matters.
In Pennsylvania, CPAs must adhere to the IRS’s regulations published in Circular 230 as well as a Code of Professional Conduct and licensing requirements set forth through the Pennsylvania State Board of Accountancy. To obtain a CPA license in Pennsylvania, CPAs must graduate from college with an accounting degree and specified core courses, pass a rigorous national exam, and have specified work experience. To maintain a CPA license, these professionals must complete 80 hours of continuing education credits every two years.
Everyone hopes that there is no need for an audit, but if you get questions from the IRS related to a tax return CPAs have these quick tips:
- Don’t ignore the request. Contact your CPA immediately and share the correspondence.
- Have your CPA respond promptly to the IRS, including answering requests and providing information.
- Be organized.
- Provide only the information requested. Period.
- Carefully review any assessed penalties for errors. The IRS can make math errors too.
- Never give the IRS the only copy or the original of a document.
If an IRS agent presents you with a bill, you have the option to agree and sign the document, or dispute the amount using one of the available dispute alternatives including filing a formal Protest with IRS Appeals. A CPA can help you decide the best course of action for you.
Not all tax preparers are created equal, and it’s critical that you know your needs and hire the person who best helps you reach your financial goals. There are some key tax traits that may indicate that it’s time for a CPA to help with your taxes. You can find this information and more at www.picpa.org/consumers.