Audit Protection

Peace of Mind Services

Before you buy an insurance product like audit protection insurance, it’s important to know what you’re buying. Audit protection doesn’t protect you from being audited. Nobody can prevent you from being audited. The IRS has the right to audit anyone, and its audit process is at least partially random.


Audit protection is an add-on service provided by some tax filing companies. They guarantee that a certified tax professional will help you understand communication from the IRS.

Types of Audits

In general, an audit is an investigation of an existing system, report, or entity. It may be conducted by either an internal or external party, depending on the situation.

Financial Audit

A financial audit is an analysis of the fairness of the information contained within an entity's financial statements.

Compliance Audit

A compliance audit is an examination of the policies and procedures of an entity or department (internal or regulatory standards)

Construction Audit

This is an analysis of the costs incurred for a specific construction project (The contracts granted to contractors, prices paid, etc.)

Tax Audit

An analysis of the tax returns submitted by an individual or business entity, to see if the tax information and any resulting income tax payment is valid.

Will Audit Protection Actually Help You?

As much as I like to poke fun at bureaucrats, the IRS is ostensibly reasonable to deal with. It sends audit letters using plain English and tax jargon, but the letters spell out exactly what the IRS needs.

In most cases, individuals undergoing an audit need to send personal records. These include records for businesses you own, receipts for rental houses, and various forms that you need to fill out your taxes anyhow. If you have great records, an audit shouldn’t end up being a huge deal. The audit may reveal a “contentious deduction” and the IRS decides you owe more money, but good records will mitigate most of the pain of an audit.

Individual or Business?

Looking For Consulting In Any of Our Services?

Our experts in Divine Group LLC will guide you through any process or paperwork correctly and professionally. Contact us today for more information.

How Much It Costs?

All of that said, the value of audit protection depends a lot on how much it costs. In general, spending money on bookkeeping software is a much better use of your money than spending money on audit protection.

Should Anyone Consider Audit Protection? 

If you’ve got simple taxes like a W-2 job, and a few 1099-INT forms, audit protection isn’t worth anything. On the other hand, people who take advantage of every tax-advantaged account, have multiple businesses, and invest in MLPs will have tons of records. Even if you keep great records, you may need help explaining your unique situation to the IRS.

We are wary of recommending audit protection to most people. I think when most people understand what audit protection is, they won’t opt for it. If you can get audit protection for free (or really inexpensively), you could argue for it.

Competitive Rates & Services

We Can Help You In Any Of Our Services!

Our experienced staff in Divine Group LLC will use all of their knowledge to work alongside you correctly and on time. Contact us today for more information.

Scroll to Top