If, despite the odds, you or your business are the object of an IRS audit, there are steps to take to survive the ordeal. According to Ingram, those steps include:

• Remaining calm
  
  
• Contacting your tax preparer immediately so they can review the letter sent by the IRS
  
  
• Keeping paperwork organized is helpful so if an audit arises, necessary information is easy to find
  
  

Ingram says another important tip is to “make sure you have documentation for all deductions, including the mileage you claim on your taxes.”

CPA Mark S. Gottlieb, owner of Manhattan-based MSGCPA, offers suggestions for minimizing the likelihood of an audit. They include:

• Filing taxes on time
  
  
• Filing complete tax returns with the appropriate schedules and attachments
  
  
• Being certain the returns are error-free and sans omissions
  
  

Gottlieb agrees that if notice of an audit is received, communicating with one’s tax preparer immediately is a smart move. He says a business owner should “instruct their tax professional to communicate with the taxing authorities to understand the issues” triggering the audit.

Even though it might be tempting not to want to communicate openly with the IRS, Gottlieb says doing so will help an audit proceed more smoothly.

“Start a cooperative dialogue in a timely and efficient manner,” he suggests.

Triggering an audit

According to Ingram, certain pronouncements in a tax return that seem illogical are one way to trigger an audit. For example, high deductions for a business where those benefits don’t make sense can be troublesome.

Another no-no is “repeatedly claiming financial losses in your business,” she says. At some point, says Ingram, the IRS will start to wonder if your enterprise is truly a financial endeavor or merely a hobby.

“It sound suspicious if you claim a loss year after year,” she says.

Gottlieb says the IRS employs another strategy for detecting potential tax fraud. The IRS, he says, maintains data on the financial pictures of what commonly-sized businesses in an area earn in a year. Wild deviations from those medians can trigger further investigations from the IRS.

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Tami Kamin Meyer is an Ohio attorney and writer who tweets as @girlwithapen.