An interview with Drake Audit DefenseTM experts, Victoria Wells, 1040 Full Service Expert (former H&R Block tax pro) and John Reida, Senior Product Manager
It might show up months after a return was filed, just as a tax professional is working through extensions, preparing for another filing deadline, or finally catching up on everything that had to wait during tax season: the audit letter.
For the taxpayer, the letter can be stressful. For the tax professional, it can mean something else, too: hours of unexpected—and potentially unpaid—work.
In a recent conversation about Drake Audit Defense, Victoria Wells and John Reida shared their expertise on what happens after a taxpayer receives a notice, where tax professionals can get pulled into the process, and why having a plan for post-filing issues can benefit both the firm and its clients.
Their message was straightforward: Audit defense isn’t simply about preparing for an audit. It’s about deciding who will handle the work when a client receives a notice.
The tax return may be finished. The work may not be.
Tax professionals know the scenario. A client receives a notice from the IRS or a state taxing authority and immediately calls the person who prepared the return.
Now the preparer has to understand the notice, revisit a return completed months earlier, talk with the client, gather documentation, determine the appropriate response, and keep track of the deadline.
And the timing can be difficult. Wells and Reida pointed to notices arriving in the fall—sometimes around October or November—as a particularly challenging example. Tax professionals may already be dealing with extension deadlines, year-end work, and preparations for the upcoming filing season.
Suddenly, a return the firm thought was finished is back on someone’s desk.
For covered matters, credentialed tax experts can help enrolled taxpayers navigate eligible IRS and state notices, audit inquiries, and qualifying tax-related identity theft issues. That can include reviewing correspondence, helping with documentation, tracking the issue, and assisting throughout the resolution process.
The value proposition Wells and Reida emphasized is simple: take that work off the tax professional’s plate.
Why responding to an IRS notice isn’t always straightforward
One misconception Wells and Reida discussed is the assumption that receiving an IRS notice means the taxpayer simply needs to do exactly what the notice says.
Tax matters aren’t always that simple.
The underlying return needs to be understood first. Depending on the circumstances, the appropriate response could involve providing documentation, disputing information contained in the notice, correcting information, or potentially amending a return.
The important point is that the notice itself doesn’t determine the appropriate tax strategy.
That’s where knowledgeable representation can become valuable. Instead of a taxpayer trying to interpret unfamiliar correspondence—or automatically turning to the preparer for help—a professional can evaluate the situation and determine the appropriate next steps.
Some notices create more questions than others
Wells and Reida also identified several situations they see creating concern for taxpayers and additional work for preparers.
Unreported or missing income is one example. Information reported to the IRS may not match what appeared on the taxpayer’s return.
Returns involving refundable credits or qualifying children can also lead to requests for documentation. A taxpayer may be asked to substantiate eligibility by providing records they weren’t expecting to produce months after filing.
Schedule C taxpayers present another common scenario. A taxpayer with a side gig or sole proprietorship may have income, expenses, or losses that require additional substantiation.
None of these situations automatically means something was done incorrectly. But when questions arise, somebody has to respond.
Without a post-filing strategy, that responsibility can quickly land back with the preparer.
“Who is going to handle this?” may be the better question
One of the most useful takeaways from the conversation with Wells and Reida was a shift in how firms can think about audit defense.
Instead of asking:
“How likely is my client to be audited?”
Consider asking:
“If this client receives a notice, who is going to handle it?”
That’s an operational question as much as a tax question.
A preparer may be perfectly capable of helping the client. But capability isn’t the only consideration:
-Does the firm have the time?
-Is this work included in the original preparation fee?
-Who will monitor deadlines?
-Who will gather the documents?
-Who will communicate with the client?
-And what happens if the notice arrives during one of the busiest weeks of the year?
Those questions get to the heart of what Wells and Reida described as an important benefit of audit defense: the flexibility to offload post-filing work when the firm needs that capacity somewhere else.
Peace of mind can be part of the client experience
The conversation also touched on something Wells learned earlier in her career at H&R Block: many taxpayers value protection because they value peace of mind.
A taxpayer may never receive an IRS notice. But if one arrives, knowing that professional assistance is available can provide peace of mind and change the experience considerably. That makes audit defense more than a response to a potential audit. It can become part of how a tax firm defines its client experience after filing.
What happens when a covered client gets a letter?
Wells and Reida emphasized the importance of acting promptly when tax correspondence arrives. An IRS notice might arrive months after a return was filed, just as a tax professional is working through extensions, preparing for another filing deadline, or finally catching up on everything that had to wait during tax season.
For Drake Audit Defense, an enrolled taxpayer must notify Drake Software within 30 days of receiving an eligible notice or inquiry. From there, credentialed tax experts can help navigate the covered issue.
That can shift the experience from:
Client gets a letter → client panics → client calls preparer → preparer stops what they’re doing
to a defined process for getting the client the appropriate assistance.
That distinction can become especially important during peak periods.
Audit defense isn’t about expecting the worst
Perhaps the biggest misconception to correct is that audit defense is only for taxpayers with unusually complicated returns.
Wells and Reida’s perspective suggests a different way of looking at it.
Audit defense is also about time, workflow, client service, and capacity.
A tax professional doesn’t have to believe every client will be audited to recognize the value of having a process for the clients who do receive notices.
Because those notices don’t arrive according to the firm’s calendar.
And when they arrive, deadlines, documentation, and client questions arrive with them.
Make the decision before the letter arrives
The best time to decide how your firm will handle an IRS notice isn’t when a worried client is already holding one.
It’s before the return is filed.
For some practices, handling post-filing matters internally will continue to make sense. For others, outsourcing eligible audit and notice work can preserve valuable staff time while giving clients access to professionals focused on navigating those issues.
As Wells and Reida emphasized throughout the conversation, that’s the broader value of audit defense: giving tax professionals another way to serve their clients without requiring them to personally take on every piece of work that comes after filing.
With Drake Audit Defense, the question doesn’t have to be, “What am I going to do if my client gets a letter?”
Instead, the firm can already have an answer.
Learn more about Drake Audit Defense by contacting our sales team.
Disclaimer: This article is for informational purposes only and not legal or financial advice.
Drake Audit Defense services are subject to eligibility, terms, exclusions, and limitations. Services are not insurance. Consult Drake Software’s current Audit Defense terms for complete coverage details.
