Loan 365

When a small business is audited, it merely means that the IRS detected a discrepancy in your records or found that there was reason to suspect that you had paid an incorrect amount of money in taxes. If the IRS raises a red flag on your small business’s tax returns, the IRS may conduct an audit to inspect the financial records you keep for your company.

When the IRS audits you, it will merely ask you to provide a number of different records, which it will examine and compare against the tax returns that you submitted. An audit is not a finding of wrongdoing; it is only a process by which the IRS attempts to figure out your correct tax burden. Therefore, the agency will not attempt to punish you by freezing your account.

If you refuse to pay taxes that the IRS declares that you owe, you will be given a number of warnings from the agency designed to encourage you to pay what you owe. If you fail, the agency may choose to place a levy on your bank account. When this happens, you will be barred access to the account, and the IRS will draw what it needs to make up the debt you owe the government.

You will not face a bank levy during an audit. The only way that an audit could lead to a bank levy would be if the audit found that you had underpaid your taxes. If this were the case, the IRS would inform you of how much money you actually owed. If you refused to pay this amount for a long period, the IRS might take the step of levying your bank.