Your audit has a better opportunity at being completed faster and achieving a better outcome if an attorney is in charge. In a 2009 case in the 6th Circuit of Appeals known as the United States v. Rutherford, any statements made by the defendants to their tax accountant could be submitted as evidence. Our timely intervention helped them avoid unnecessary fines and ensured compliance with the latest IRS regulations in 2025.
The Limitations of Online Tax Software for Complex Filers
However, for those with more complex needs or substantial deductions, consulting a professional is often the best route to ensure thoroughness and accuracy. The free version is designed for simple tax returns and may not cover more complex situations like itemized deductions or certain types of income. At Silver Tax Group, our tax attorneys know exactly which IRS forms matter most in your case. We break down complex legal jargon into clear, simple language so that you understand every step of the process.
Should you be audited, TurboTax will assign a representative to assist with the audit process and help manage communication with the IRS. Profit and prosper with the best of Kiplinger’s advice on investing, taxes, retirement, personal finance and much more. While this tool can boost refunds, it may occasionally encourage upgrades that aren’t necessary for every tax situation.
The notice highlighted a $250,000 discrepancy between the revenue reported on their tax return and the information provided by third parties. I’ll explain the risks, common pitfalls, and the calm that comes when you have solid backup. The biggest difference between the free service and Audit Defense is having someone to represent you in dealing with the IRS. But given that’s where TurboTax’s defense ends, you might be better off dealing with an unlikely audit with a tax attorney—if that time ever comes. Audit Defense, on the other hand, is a perk from paying for TurboTax’s MAX package. You’ll have the aforementioned full representation by a licensed tax professional during all interactions with the IRS.
Their internal team struggled with hundreds of pages of paperwork and confusing IRS forms. When they brought us in, we organized their records, set up a clear timeline for responses, and communicated directly with the IRS. Knowing what to expect—from notices like CP2000 or Letters 2205C to detailed documentation requests can help you safeguard your interests and take the right steps to protect your money. When the IRS comes looking for your money, even if only by letter, anxiety can hit us hard.
For those with straightforward tax returns, TurboTax offers a user-friendly, cost-effective solution. However, when dealing with complex situations or potential audits, the limitations of TurboTax Audit Defense can make a more comprehensive service worthwhile. Tax professionals, online preparation services, and tax prep software providers typically offer tax audit defense services, which is like insurance for filing your tax return. You pay additional fees for audit defense protection, just like you pay premiums for homeowners’ insurance to protect your house if it suffers major damage from some event. TurboTax Audit Defense primarily benefits those with simple returns, as individuals with more complex filings—such as business owners or investors—may need specialized representation. For those with intricate tax situations, Dimov’s tax professionals offer more comprehensive audit support, tailored advice, and representation before the IRS.
- TurboTax, for example, has AI guidance with Intuit Assist, which answers any questions throughout the process.
- You pay additional fees for audit defense protection, just like you pay premiums for homeowners’ insurance to protect your house if it suffers major damage from some event.
- Having the right legal support can significantly change the outcome when facing the IRS.
- It’s good to know that your return will be accurate, but the chance of an audit still remains.
- Whether you’ve filed taxes yet or not, knowing about TurboTax’s Audit Defense can help you stay better informed for the future.
Our guide includes everything you need to know about TurboTax’s Audit Defense, including what it covers and how much it costs. We’ll also discuss your odds of getting audited, which are pretty slim for the average American. Carla Ayers joined Kiplinger in 2024 as the E-Commerce & Personal Finance Editor. She earned a master’s degree in Integrated Marketing Communications from Eastern Michigan University.
However, if your financial situation is complicated, its automated approach might not cover every nuance. In short, TurboTax MAX is a basic option that might suit simple cases but may leave you wanting more robust support when the numbers get complex. The confusion was about whether to file an amended return for an overstatement of R&D credits. With deadlines looming, the business risked incurring additional penalties for filing errors.
Is TurboTax MAX and Audit Defense Worth It?
When an accountant reveals too much to the IRS, the consequences can be severe. Oversharing might strip you of legal protections, exposing your sensitive data and increasing the risk of penalties or even criminal charges. It’s vital to have someone in your corner who understands the nuances of IRS law and who can ensure your rights remain protected throughout the audit process. If sensitive business data is shared without proper legal protection, you could lose vital benefits like attorney-client privilege.
Is TurboTax the right tax software for you?
Unlike your usual accountant, a tax attorney is laser-focused on defending your rights during an audit. Keep in mind that your Audit Defense membership applies to that year’s membership individually. So, if you had Audit Defense for your 2019 return, you’d be covered for that year if you were audited in, say, 2022. You’d have to renew your membership again in 2020 if you wanted the same protection for that year’s returns.
An office audit occurs when the IRS invites you to one of its offices for an in-person review of your tax return. You will be given a specific date, time, and location, and you are required to attend the meeting, often with a legal representative. When the IRS comes after you, every document, every number, and every calculation matters. Without expert guidance, you risk turning a minor error into a major catastrophe. Audit defense offers peace of mind, protecting your rights while fighting for a fair outcome. For instance, one small business owner received a letter for a correspondence audit and lost sleep over minor discrepancies.
Dimov’s tax professionals offer the depth and expertise necessary to navigate the intricacies of tax law, safeguard against audits, and maximize your financial outcome. TurboTax is especially well-suited for people filing simple tax returns — think W-2 income, student loan interest and a few common tax credits. While its free version works well for basic needs, paying for a higher tier can be worth it for the added support if your return is a bit more complicated.
Finally, users can file state tax returns through TurboTax for an additional fee in most cases. However, some states offer free filing options, so it’s worth checking local requirements before paying for the add-on. For those seeking additional help, TurboTax Live connects users with tax experts for real-time assistance. This service is ideal for complex returns but comes at an added cost, which may not be worthwhile for simpler filings. Most importantly, working with a trusted tax advisor can help you make sure you are prepared and protected as you go through the audit process. The chances of you being audited will likely determine whether paying for TurboTax MAX is worth it for you.
- TurboTax offers several features designed to simplify tax preparation and help users get the biggest possible refund.
- Without expert guidance, you risk turning a minor error into a major catastrophe.
- If you’re searching Google for “Find a CPA near me,” keep reading to find out more about what you should look for.
- Dimov’s professionals are trained to ensure that every dollar is accounted for, minimizing the risk of an audit.
- One of our clients, a mid-sized retail business faced an IRS investigation in 2023 after their tax return revealed a $120,000 discrepancy.
TurboTax
TurboTax Audit is turbo tax audit defense worth it Defense is part of the MAX services, which cost $60 on top of your tax preparation fees. It’s important to note that this service is a flat $60, whether you file a basic or a more complicated return. While you might feel like saving money with tax preparation, sometimes paying a bit more for a version that fits your needs can be well worth the frustration you avoid. That’s why it’s important to file your taxes accurately, whether you do it yourself or find a software or company that will guide you. A few minor errors could trigger an audit, but most of us are worried about the worst-case scenario happening to us.
Once you mail in the requested documentation, your issue is often resolved. If you lack the required proof, you may have the option to pay the difference and close your case or challenge the IRS’s findings. Taking prompt action upon receiving the first notice is vital to avoid penalties. We reviewed their sales records and identified that the discrepancy was due to a misfiled revenue report. We prepared and submitted a response the same week, including corrected figures and supporting documents, which was accepted by the IRS. For example, with a national restaurant chain that received a CP2000 notice from the IRS.
What is TurboTax Audit Defense?
As long as you complete your tax filings accurately and on-time, the chances of an audit are low. If you’re searching Google for “Find a CPA near me,” keep reading to find out more about what you should look for. The choice you make in hiring a tax attorney makes a huge difference, especially for something as serious as a tax audit. You should also know that if TurboTax can’t connect you to a tax professional, they will refund your money. That’s all well and good, but $60 doesn’t go very far if you’re facing an audit and need representation.
This vulnerability could expose your business to heavy penalties or even criminal charges, making it essential to have legal experts who can properly navigate these situations. We stand with you when the IRS calls, handling everything from IRS communication to settlement talks. While the idea of an audit can be intimidating, remember that you have the right to professional representation. Engaging an experienced tax defense team can make all the difference when facing the IRS.