The young man was only 22, and he was scared. So scared that he brought his grandmother along for moral support. So shaken that the IRS auditor across the desk put down her papers and said: “Are you OK? Do I need to call the paramedics?”
At this point, Grandma did a strange thing: She began to laugh hysterically. Then she told the auditor that, after the Internal Revenue Service’s letter summoning him for an audit arrived, all of her grandson’s co-workers had convinced him that he was going straight to prison.
Tax Technician Ellenmarie Ramirez remembers biting her lip to keep from laughing at the poor fellow’s ashen face, then telling him, “I’ve never sent anyone to jail! Now breathe !”
Just a typical incident in a typical day of a typical IRS auditor.
Bomb threats, fires, lies, tears--Ramirez has seen it all, and she’s only been with the IRS for a year and a half.
She is an in-house auditor.
Taxpayers whose returns cause the computer in IRS headquarters in Fresno to raise its megabyte eyebrows are sent to her--and hundreds of in-house auditors like her--to justify this deduction or that credit.
Starting pay for auditors is about $12,000; “field auditors"--those who chase bigger cases by going into homes and offices--earn about $15,000 to start. And, no, auditors don’t get a commission on the returns they audit, nor do they have a quota system, according to Ramirez.
Ramirez’s day begins at 7 a.m., when she arrives at work and starts an hour of “oversight” review of the previous day’s work. At 8 a.m., she gets the first buzz from the receptionist and the audits for the day get under way.
Ramirez does two audits before lunch, two after; as often as not, she sees only the taxpayer’s accountant. “The taxpayer’s representative often prefers that his client not come in, because they always open their mouths at the wrong time, and once they’ve said something, I have to follow up on it,” she said.
Returns are sent to Ramirez from Fresno already “classified"--she knows that, for example, the mortgage interest claimed is out of proportion to the income. “I’ll review the rest of the return and see if there’s anything else wrong, then in our meeting, I’ll ask the taxpayer to verify his claims,” she said.
And that’s often easier said than done.
Some people change their stories four or five times during a two-hour audit. Some are indignant when Ramirez points out that, if all the Schedule A deductions are accurate and the income is accurate, there wouldn’t have been enough money left to buy food. Some are confused when she won’t let them claim themselves as dependents. Most are simply frightened.
But, according to Ramirez, they shouldn’t be. “We really want to help people,” she said. “A lot of people either end up owing less or even getting a refund after being audited, and we’re happy about that.”
Ramirez starts most audits by asking routine questions, both to get these over with and to give the taxpayers a chance to relax by talking about their families and what they do for a living. She tries to calm the nervous ones down, although she admits that sometimes, when she knows that paying back taxes is going to be hard on a family, she wants to cry, too.
Emotionally, the toughest cases can be when audits involve new citizens who don’t speak English well. “They get their taxes done by men in vans in parking lots,” she said. “They’ll pay someone they’ve never seen $100 to do their returns, and that guy fills something out that has nothing to do with reality.”
The IRS tries to be fair when they see this kind of scam, Ramirez said. It will try to find the preparer and put him out of business. “And if the taxpayer gave information to the preparer in good faith and he inflated figures or whatever, the taxpayer (has to pay any taxes due but) doesn’t get penalized,” she said. That doesn’t stop Ramirez from feeling bad for people who are certain they will be deported for one mistake on their return.
Most audits aren’t over in one neat, two-hour package, Ramirez said. “Taxpayers often bring in the wrong documentation, so we go as far as we can and then I send them home for more information,” she said. New appointments have to be made, and the process can drag on for months.
“Some people seem to think that delays are in their favor,” Ramirez said. “But I always tell them that the interest keeps running, and they’re just going to owe more the longer they put off resolution.”
Still, some folks believe that they can fool Uncle Sam by dallying until the statute of limitations runs out, but if the return is already being audited, the IRS has the law on its side.
In cases that don’t involve fraud, the statute of limitations is three years from the date of filing or April 15, whichever is later; there is no time limit when fraud is at issue. “So save everything forever if you’re doing something bad,” Ramirez said.
And after you’ve been audited once, Ramirez cautions, the IRS may go back in a couple of years and audit you again, just to make sure you’ve straightened up and flown right. These are often the most irritated taxpayers she has to confront.
Since Ramirez is in management training, she’s not a clock watcher, although her day officially ends at 4:45 p.m. She often spends time after the huge office quiets down, cleaning up her desk, writing notes to herself about audits under way, decompressing.
“Most of the time, I don’t think about the audits themselves after I go home,” Ramirez said. “I just can’t take the work home--if I did, I wouldn’t want to come back. You’d burn out so fast.”