Every entrepreneur creating an LLC dreads an IRS visit, but a new video on the IRS website helps small businesses prepare and organize for a possible audit.
The IRS has created a convenient and easy-to-use video, Your Guide to an IRS Audit, that business owners can view at any time, writes Laura Strachan at FindLaw.com.
The video addresses critical concerns business owners might have, such as preparation of tax records, what to expect after an initial IRS visit, payment options and when to consider legal representation. The video also helps business owners by explaining the appeals process.
Strachan recommends maintaining well-organized and detailed financial records in the event a business is audited.
The chances of a small business being audited by the IRS are increasing. Between 2005 and 2007, the number of small business audits rose by 41 percent, while during the same period the number of audits of big businesses actually decreased by 40 percent.
Caleb Groos at FindLaw.com recommends business owners keep bank statements, expense receipts, auto records, property expenses and register receipts on hand in the event of an audit.