Knock, knock...it's the IRS at your door!

The IRS normally will give you warning of a visit, but sometimes they can just appear at your home or business unannounced.

If they do, it is almost always due to unpaid taxes, specifically--unpaid payroll taxes. And while they are there, everything is fair game. They might want to look at your company checkbook, your cash register, your sales receipts--anything that can provide ammunition to be used against you.

So what should you do if an IRS officer or employee shows up at your business and starts asking question? That's easy. Immediately tell the officer that you wish to consult a representative (i.e. a CPA, attorney or anyone else authorized to represent taxpayers before the IRS). If you request this, the IRS must stop the interview immediately. If the IRS agent does not do so, he or she will be in violation of federal law. Internal Revenue Code Section 7521(b)(2) says the following:

If the taxpayer clearly states to an officer or employee of the Internal Revenue Service at any time during any interview (other than an interview initiated by an administrative summons issued under subchapter A of chapter 78) that the taxpayer wishes to consult with an attorney, certified public accountant, enrolled agent, enrolled actuary, or any other person permitted to represent the taxpayer before the Internal Revenue Service, such officer or employee shall suspend such interview regardless of whether the taxpayer may have answered one or more questions.

And despite what you may have seen on Law & Order or CSI, asking for a representative does not make you look guilty. You are simply telling the IRS agent that despite their best efforts to blindside you, you want to consult with a professional that can help you prepare for the interview and provide the most accurate information possible.

If your first inclination is to tell the IRS agent to get off your property, do it the right and legal way, consult a representative and then respond to the IRS.

You can even have your representative handle the interview without your being present.

S. Raines, Sr. Financial Advisor/Tax Preparer