Navigating an IRS Audit as an Attorney: Your Essential Roadmap

Facing an IRS audit as an attorney can be daunting but fear not! Understanding the IRS Audit Technique Guide (ATG) is your secret weapon in navigating these waters. The IRS uses the ATG to assist them in auditing specific industries. Here’s your personalized roadmap on what to do if you find yourself under IRS scrutiny:

  1. Get Acquainted with the ATG: The ATG is your playbook—it outlines how the IRS dissects law firms during audits. Dive into this resource to grasp common practices and where tax regulations intersect with legal services.
  2. Prepare Your Defense: Armed with the ATG, assess your billing practices, expenses tied to client representation, trust account adherence, and tax reporting. Check for any discrepancies or potential red flags.
  3. Consult a Pro: Don’t go it alone! Seeking advice from a tax professional who understands the nuances of legal practices can be a game-changer. They can help you interpret the ATG and prepare your defense strategy.
  4. Audit-Proof Your Practices: Use the insights from the ATG to fine-tune your operations. Ensure your fee structures, expense records, trust accounts, and tax filings align seamlessly with the guidelines outlined in the ATG.
  5. Stay Ahead of the Curve: Incorporate ATG insights into your ongoing practices. Regularly review and update your procedures to reflect compliance with the guide’s recommendations.
  6. Craft Your Response: If audited, respond promptly and comprehensively. Use your understanding of the ATG to address IRS inquiries confidently and provide clear, substantiated information.

Remember, an IRS audit doesn’t have to be a nightmare. Understanding the IRS ATG gives you an edge—an insider’s view into the IRS audit process tailored for legal professionals. By leveraging this resource, seeking expert guidance, and aligning your practices accordingly, you can confidently navigate an audit, ensuring compliance and safeguarding your legal practice.

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Petry Law Firm, PLLC

Lucy Petry started Petry Law Firm, PLLC, not for profit or notoriety, but because she has a real desire to help individuals and businesses with their legal needs. Lucy personally supervised and prepared over 15,000 tax returns, which makes her well-equipped to handle your business and IRS issues. In addition to her professional accomplishments, Lucy is also fluent in Spanish and Portuguese. She enjoys seeing and learning about the world, having traveled to more than 50 countries, lived abroad and is an advanced diver and a pilot. She currently lives in Houston with her two rescue dogs, Elsa and Keyer.

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