Field Audit Survival Guide: Interviews, Visitation, and Evidence

Overview

Field audits are the IRS’s most invasive audit type: auditors come to your business or home to review books, interview staff, and collect or copy evidence. In my 15+ years helping clients through audits, the difference between a stressful, protracted field exam and a contained, efficient one is almost always preparation and clear communication.

This article walks through what to expect, how to prepare for interviews and site visits, how to organize and present evidence, and practical interaction strategies that protect your legal rights and limit disruption.

Sources: IRS audits overview and Publication 556 explain procedures and taxpayer rights (IRS: Audits; IRS Pub 556). See the Taxpayer Bill of Rights for additional protections (IRS: Taxpayer Bill of Rights).

Key stages of a field audit

• Notification: The IRS sends a written notice that names the auditor, provides contact information, and defines the scope and tax years under review. Do not ignore this letter.
• Preparation: You gather records, create concise summaries, and decide who will talk to the auditor.
• On-site visit & interviews: An IRS agent visits to inspect records, interview owners/employees, and may request copies or digital access.
• Follow-up: The auditor issues proposed adjustments or requests further documents; you can respond, negotiate, or file appeals.

Typical documents requested include tax returns, general ledger, bank statements, receipts, payroll records, contracts, and supporting schedules.

Before the auditor arrives: practical preparation

1. Read the notice carefully and calendar deadlines. Some notices give short response windows.
2. Hire representation early. A CPA, EA, or tax attorney who does audits can manage communications, request clarifying scope in writing, and reduce mistakes. If you hire someone, use IRS Form 2848 (Power of Attorney) so your representative can speak for you. Our internal guide explains the role of POA in audits: “The Role of Power of Attorney in Tax Audits and Collection Matters”.
3. Create a document packet and an index. Organize records by issue (income, COGS, payroll, travel, home office) and include a one-page executive summary for each issue that explains your position and points to specific documents.
4. Make working copies and a digital mirror. Never hand over original records without keeping copies; provide organized copies (PDFs are preferred) and a single master directory. Keep originals in a secure location.
5. Prepare staff. Tell employees what to say: honest, brief answers and to refer detailed technical questions to you or your representative.
6. Practice interview answers. Draft short, factual responses for likely questions (see sample scripts below).

During the on-site visit: interviews and conduct

• Identify the auditor: verify name, badge, and office contact. If anything seems off, pause the meeting and call the auditor’s listed office number.
• Control the environment: conduct interviews in a private workspace with your representative present. Limit access to unrelated areas and files.
• Stick to the scope: auditors should only examine the years and issues listed in the notice. If they request additional years, ask for the request in writing and consult your advisor.
• Don’t volunteer extra information. Answer questions directly and succinctly; provide documents when requested, but avoid offering unrelated explanations that invite deeper scrutiny.
• Take careful notes: record names, dates, documents requested, and any oral statements the auditor makes about the case.

Sample interview scripts:

• Question: “How do you document business mileage?”
  Short answer: “We use a mileage log maintained in [software or notebook]. Here are copies of the logs and supporting calendar entries.”
• Question: “Why is this expense categorized as advertising?”
  Short answer: “We tracked this as advertising because it was for paid sponsored posts on social media; here are invoices and screenshots of the campaigns.”

Evidence: what to provide and how to organize it

Evidence is strongest when it is contemporaneous, tied to your accounting system, and corroborated by third-party records (bank records, vendor invoices, contracts, or payroll reports).

Best evidence hierarchy:

1. Third-party records (bank statements, 1099s, payroll reports)
2. Vendor/sales invoices and paid receipts
3. Contracts and signed agreements
4. Internal logs and contemporaneous notes

Organize evidence by issue and include an index with clickable links in your digital packet. For physical records, provide a labeled binder or notebook and retain originals. If an auditor requests originals, provide copies and offer originals for inspection on site.

Chain of custody and digital evidence:

• For electronic files, provide checksums or document timestamps when possible and maintain a log of files delivered.
• Avoid handing over systems access; instead export reports and datasets and deliver them on read-only media or secure file transfer.

Common auditor tactics and how to respond

• Requests for broad categories: Ask for clarification and limit production to the stated years/issues. If the auditor insists, have your representative request a formal notice or summons.
• Repeated interviews of staff: Ensure employees know they may ask for your representative to be present and avoid answering beyond their role.
• Surprise requests for original documents: Provide copies first and explain why you retain originals; this is routine and acceptable.

Remember: the IRS may issue a summons to obtain testimony or documents, but summonses follow specific procedures. If you receive a summons, contact your advisor immediately.

Timelines and potential outcomes

• Duration: An on-site field audit commonly lasts one or more days but can take weeks or months if complex records or multiple years are involved.
• Outcomes: no change, adjustments that increase tax, or sometimes refunds when the IRS agrees you’ve overpaid.
• Appeals: If you disagree with findings, use the IRS Appeals Office or pursue collection due process—discuss options with your representative.

For a broader breakdown of audit types and how the IRS prioritizes cases, see our glossary piece “Navigating the IRS Audit Process: What to Expect” and our step-by-step field audit prep piece “Surviving an IRS Field Audit: Step-by-Step Preparation”.

Proof, persuasion, and negotiation

If an issue rests on interpretation (e.g., whether a contractor is an employee, or whether an expense is ordinary and necessary), your best defense is layered evidence: contracts, contemporaneous invoices, consistent accounting practices, and third-party corroboration. Be prepared to explain your policies and demonstrate consistent treatment across years.

When facts are unfavorable, consider negotiation options early: reasonable cause, partial concession, or an agreed-upon adjustment with a memo explaining mitigating circumstances. Effective negotiation is almost always easier with a knowledgeable representative leading the conversation.

Checklists: day-of and documentation

Day-of visit checklist:

• ID and contact of auditor verified
• Representative present and POA (if used)
• Copies of requested documents prepared and indexed
• Originals secured and a copy log signed
• Notes taken of all oral statements

Documentation checklist (by issue):

• Income: bank statements, deposit slips, 1099s, sales journals
• Expenses: vendor invoices, receipts, canceled checks, credit card statements
• Payroll: payroll reports, Form 941s, W-2s, contractor agreements
• Assets: purchase invoices, depreciation schedules, title/ownership documents
• Home office: floor plan, utility bills, time logs, rental records (if applicable)

For guidance on organizing supporting documentation, see our internal article “How to Organize Supporting Documentation for a Tax Audit.” Use that workflow to create your packet.

Red flags and triggers to avoid in the future

Common red flags that trigger deeper scrutiny include large, unusual deductions relative to income, mismatched third-party reporting (1099s vs. what you reported), and inconsistent treatment of similar transactions across years. Our article “12 Unexpected Red Flags That Often Trigger IRS Audits” lists typical triggers and prevention tips.

Final professional tips

• Hire experienced representation early; this reduces mistakes and preserves options.
• Keep contemporaneous records; retrospective reconstructions rarely persuade auditors.
• Be factual, concise, and organized during interviews; unnecessary detail can create new lines of inquiry.
• Preserve originals and maintain a clear chain of custody for documents you deliver.

In my practice, the most effective clients were the ones who presented a single, well-indexed packet and a calm, consistent narrative backed by third-party records. That combination shortens audits, reduces costly appeals, and often leads to better outcomes.

Resources and further reading

• IRS Audits Overview: https://www.irs.gov/businesses/small-businesses-self-employed/audits
• IRS Publication 556, Examination of Returns, Appeal Rights, and Claims for Refund: https://www.irs.gov/pub/irs-pdf/p556.pdf
• Taxpayer Bill of Rights: https://www.irs.gov/individuals/taxpayer-bill-of-rights

Related FinHelp articles:

• Surviving an IRS Field Audit: Step-by-Step Preparation — https://finhelp.io/glossary/surviving-an-irs-field-audit-step-by-step-preparation/
• How to Organize Supporting Documentation for a Tax Audit — https://finhelp.io/glossary/how-to-organize-supporting-documentation-for-a-tax-audit/
• The Role of Power of Attorney in Tax Audits and Collection Matters — https://finhelp.io/glossary/the-role-of-power-of-attorney-in-tax-audits-and-collection-matters/

Professional disclaimer: This guide is educational and based on my experience as a CPA. It is not a substitute for personalized legal or tax advice. Consult your tax advisor for guidance tailored to your situation.