Law Office of GERALD W. KELLYESQ. 
IRS Audits

An audit of a tax return by the Internal Revenue Service (“IRS”) can occur for a variety of reasons.  The IRS identifies certain groups of taxpayers and types of returns that are susceptible to increased tax assessments through the examination process, and selects returns to be audited on that basis.  If a return falls within one of these IRS targeted groups, then the likelihood of it being audited is high.  The IRS, moreover, routinely audits all clients of a return preparer that is being investigated for preparing fraudulent returns for his clients.  Audits are also initiated based on information supplied to the IRS by former spouses, disgruntled employees, business competitors, and others adverse to the taxpayer. 

Successful representation in IRS audit cases requires a thorough knowledge and understanding of the IRS’s audit procedures and, of equal importance, years of experience in dealing with Revenue Agents and their managers.  Audits typically involve voluminous financial records.  It is of critical importance that the taxpayer's representative be able to interpret the relevant records and present them to the IRS in an appropriate manner. 

Revenue Agents have the authority to issue summonses to banks, mortgage lenders, securities brokers and others that engaged in financial transactions with the taxpayer.  It is imperative that the taxpayer's representative be two steps ahead of the Revenue Agent in gathering and analyzing the documents that will be evaluated by the IRS as part of the audit process.  This is especially true in cases involving unreported income or indefensible expenses claimed on a tax return.  

Revenue Agents can refer cases to the Criminal Investigation Division of the IRS.  If there is a known, serious issue with a tax return, such as unreported income, the audit must be handled with the utmost care to avoid a criminal referral or the imposition of the civil fraud penalty, which is 75% (seventy five percent) of the additional tax due.

A Revenue Agent’s findings can be appealed administratively to the Appeals Division of the IRS.  Many cases that couldn't be resolved with the Revenue Agent are ultimately settled in Appeals.  Cases that cannot be resolved administratively can be litigated.  The fact that a taxpayer's representative is also a litigator, with the ability to contest the case in court, has facilitated settlements with the Examination and Appeals Divisions. 

My audit experience includes the following issues:

Unreported Income

Civil Fraud Penalty


Partnership Issues


Disallowed Business Expenses

Real Estate Transactions

Characterization of Income

Abusive Trust Arrangements

Copyright © 2006-2019, Gerald W. Kelly, Esq.
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IRS tax attorney Gerald W. Kelly is a former IRS Revenue Officer. He resolves civil and criminal tax problems in Maryland, DC, Virginia, and throughout the United States.  The tax law firm provides help with IRS Offer in Compromise, IRS tax audit, IRS collection, IRS appeals, IRS litigation, US Tax Court, employment taxes, IRS levy, IRS lien, IRS seizure, IRS criminal investigation, IRS responsible person assessments, IRS trust fund recovery penalty, unpaid business employment taxes, and all other major IRS problems.  The law firm is located in Columbia, Maryland (MD). 
10320 Little Patuxent Parkway 
Suite 608 
Columbia, MD 21044

(410) 740-8750
(453) 542-0069, Facsimile