Worry, stress, frustration, and that sinking feeling of
"why me?"—that's almost every taxpayer's
first reaction when they find out they're being audited. And
with good reason: taxation is a complex field, and audits are often
risky, protracted, and costly affairs.
While it's impossible to predict the length or scope of an
audit, you can often greatly mitigate its impacts, and even its tax
consequences, through careful, proactive management.
The burden of proof falls on the taxpayer
It's important to remember that in a tax audit, the
burden of proof generally falls on the taxpayer. This
means you are responsible for proving that your tax position is
sound, rather than the reverse. From the moment you receive the
audit notice until the audit closes, every interaction with the tax
authorities can directly affect the outcome of your case.
