Is membership worth the price?
Have you ever received a product or service that just didn’t live up to your expectations? Most of us have. Most of us have developed a healthy amount of skepticism before we make a purchase as a result.
Before I buy I often look for consumer reports and reviews in hopes of piercing that veil of marketing that always seems in one way or another to disappoint. In that vein I thought I would share an inside view on what in my experience were two of the most common initial expectation/misconceptions of customers who purchase a TaxAudit.com membership and later receive a letter from the IRS.
I base this on well over two thousand personal interviews (telling) from members while working for the company as an audit representative. During those interviews the two complaints that emerge almost routinely where in regards to services expected but not provided and the level of company involvement in services that were covered.
The company basically states in its marketing they will handle your audit from start to finish and take your case to the highest level of appeal if needed. That is correct. And doesn’t that sound like a straight forward enough statement? However, do you really know what that means? Think about it for a moment before you continue reading. YOUR audit will be handled from start to finish and YOUR audit will be taken to the highest level of appeal.
Ok
Services expected and level of involvement. Let’s start off with some common service expectations that are not considered by the company as part of an audit and therefore not covered:
Installment agreements, offer in compromise, Judicial appeals (a judge presiding), amended and original tax returns, extensions, estimated tax payments, audit reconsideration innocent/injured spouse and for the most part all unfiled tax forms/schedules.
Would you expect any of the above to potentially be part of an audit with the IRS? Would you expect any of the above to potentially be part of your correspondence with the IRS? See the difference?
Now let’s go over a couple examples on how these can play out for a member during an “audit”.
You moved and never received notification that you were under audit until you received a notice of intent to levy from the IRS. What could be done? This situation could be handled with an audit reconsideration (assuming you can support your position), plus a phone call to the IRS requesting the collection process be placed on hold. What will be done? You may receive advice on what to do but you will be on your own if you want to go forward.
You and your former spouse are under audit in regards to your spouse’s supposed underreporting of business income. You had no involvement in the business or filing. What could be done? It’s possible you could qualify for innocent spouse relieve. What will be done? Hopefully you will at least be told you may qualify for innocent spouse relieve and how to proceed. However, if applicable you will be preparing and filing the form. You also will be providing whatever documentation the IRS might request later and dealing directly with the IRS should they have questions
You included your employee expenses on the self employment form (wrong) when you filed your original federal tax return. During the audit the examiner indicates he will not review your documentation because self employment is not under audit. The examiner request an amended return before review or the expenses will be disallowed. What could be? An amended return could be completed, of course. What most likely will be done? You will be preparing an amended return and you will forward to the IRS or the company (who will forward to the IRS).
Your audit is completed and the result is a change in your federal return. Now you need to correct your state return to match. Yep, you will be amending your state return yourself.
I could go on and on with examples.
Level of involvement. By far the prevailing misconception here is in regards to the organization of supporting documents, especially heavy documentation that you might need for say, a business or for employee unreimbursed expenses. You will be expected to do much more than just submit your receipts and/or bank statements.
The examiner is most likely going to want to see a receipt (invoice) with a corresponding payment document (credit card, etc), a reason for the expense (if not obvious), all categorized and totaled. If you are like 80% of the taxpayers I’ve worked with you are thinking right now you are ready. If you are like 99% of the taxpayers I’ve worked with you are not. Good document organization/preparation would take an entire page just to give the basics. The point here is you will be doing most, if not all of it yourself. It’s worth mentioning there is an expectation of all documentation to be supplied within a few days and that this can be a very time consuming endeavor. (Also if you are late in submitting the documents or reporting the notice for that matter you may be subject to a $200 fee for the company to continue).
So is paying for that membership a good deal?
That is for you to decide. Just don’t let yourself be caught saying “where’s the beef?”
Feel free to ask questions!
