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IRS audits & exams9 min readIntro

How to prepare for an IRS audit: documentation checklist

Preparation is mostly organization: reconstruct income, tie bank statements to books, and gather substantiation for major deductions.

WorkMinty publishes general educational information for small business owners. It is not tax, legal, or accounting advice. Tax rules change and vary by state and situation. Consult a qualified CPA, enrolled agent, or attorney before making decisions or responding to a government audit.

Educational only · Last reviewed May 30, 2026

First: identify the letter type

  • Correspondence audit — mail-only; usually limited issues
  • Office audit — you bring records to an IRS office
  • Field audit — examiner visits your business

Read the letter for the issues listed and the response deadline.

Core documentation checklist

  • Federal and state returns for the year(s) under exam (and prior year)
  • General ledger or labeled transaction export
  • Business bank and credit card statements (all accounts)
  • 1099-NEC and 1099-K forms issued and received
  • Payroll reports if you have W-2 employees
  • Receipts and invoices for large or unusual expenses
  • Mileage log, if you deduct vehicle expenses
  • Home office calculation worksheet, if applicable

Organize by issue

If the notice questions "travel," assemble only travel substantiation first. Do not send your entire hard drive unsolicited.

Timeline tips

  • Mark the response date on your calendar immediately
  • Request an extension if you need time (through your representative if possible)
  • Never ignore a notice—silence leads to default assessments

Good practices year-round

Monthly labeling and reconciliation mean that at audit time you are confirming records, not inventing them. That credibility matters in examiner interactions.

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