What are the different types of audit protection?

Audit protection is a phrase for all services that help people who are audited. This is most often associated with tax submission audits, such as audits that carry out the Internal Revenue Service in the United States. At the company level, the audit may include account evaluation, especially in a public traded company, but "protection" against audit is usually part of the work of the company's accounts. The audit includes that the taxpayer is asked to deliver documents as evidence that specific tax claims are correct. About two -thirds of the audits are performed by mail, the rest includes a personal conversation.

Audit protection comes in two main forms. The first is the services designed to reduce the chances of audit. The second is services that help people who are audited.

There are a number of services that claim to reduce the likelihood of audit. The most expensive includes a tax professional who carefully controls submissions to seek problems that you maycall an audit. In fact, the professional performs a real audit dress test, albeit without so much stress or fear of a taxpayer. The cheapest services simply claim to offer details of the "secret" list that IRS uses to find suspicious audits. These services should be perceived with caution, even if available information comes from the legitimate IRS source, it can still be obsolete.

Audit protection services for people who are already in audit are usually administrative. They include mainly a tax professional who collects the taxpayer's documentation, finding what is needed to support the disputed part of the submission, and emphasize any missing documentation. These experts can also provide a council regarding the rights of the taxpayer in the audit process.

Another service offered is to protect audit protection. It is simply an insurance product that includes paying an annual bonus that covers any cost of professional services that ariseD is audited by a policy holder. In some cases, insurance may be offered by the same company that offers audit protection services, which means that the customer does not have to pay and raise money for services. Instead, the company simply provides services without a fee. Whether such insurance is worth it can be difficult to assess. In addition to looking at the insurance and potential costs, the customer must consider the likelihood of an audit that can be very difficult to predict. In 2008, there was about one percent of the chance of an audit for Americans to earn less than $ 200,000 a year.