Everyone panics when they get any correspondence from the IRS, even if it’s a good notice (yes, they do have those).  The first step: Don’t Panic. The second step, don’t respond until you have consulted with your Tax Preparer. The third step? DON’T PANIC!

IRS Agents are just as varied as business owners. Some are great at what they do and will work to be fair with your individual situation, and others couldn’t care less about your situation as long as they get paid. They’re just going to follow what the computer said the problem with your tax return was. The question is do you really want a human being or an impartial computer to decide your fate. The ugly part of the IRS is when you have to deal with whoever happens to answer the phone; that only relies on what the computer says. The computer is very black or white. They go strictly by the numbers and programming in their system, even if it is wrong. They cannot change their programming on their own, and is “always right” even when you can prove otherwise.

Getting a lousy IRS Agent is better than dealing with an uncaring computer. Yet most people are afraid of IRS Agents. Most people, including IRS Agents didn’t go into their carrier to terrorize other people. Usually the bad IRS Agents I have ran across, merely do not understand the industry or business you are in, or they have not kept up on the new changes to tax law, or are not familiar with regulations that were in effect even a year ago. However you do have a person to deal with. That person can override the computer. The Agent can usually be reasoned with, and will at least evaluate your position. Even a bad Agent can get you good results sometimes.

A good IRS Agent though, is not as rare to get as it seems. Normally, they’ll have a degree in Accounting or Business, they may have owned or operated a business, and/or have actually worked as an Accountant or CPA in the “real world.” They have seen business from the business side for several years before becoming agents. They have usually been with the IRS for five years or more. This means they actually have worked with older regulations and they’ll usually have kept up on the changes taking place with the regulations and the business world. They will work with you and not against you to resolve your situation so both sides – the government and the business owner – are satisfied.

Next time you receive a notice – DON’T PANIC! – this is just a part of life, like jury duty. Talk to your Tax Preparer first, and then you two can take the steps necessary to answer the IRS notice, and for Goodness’ sake, don’t ignore it and hope the IRS will go away!