IRS audits to increase thanks to Congress.

• Position: Income Taxes - Internal Revenue Service

As pressure from Congress to raise revenue and close the multibillion dollar "tax gap" continues, the Internal Revenue Service looks to increase the number of audits against high-net worth individuals, warns Alan Olsen, managing partner at Greenstein, Rogoff, Olsen & Co., LLP, San Francisco. Even though April 15 has come and gone, the IRS, as a result of increased funding and directives from Congress, is in the process of hiring a vast number of tax auditors and collectors, and creating special new units to use a wide spectrum of tactics for investigating wealthy individuals for tax compliance.

Most U.S. citizens take great pride in paying as little tax as legally possible, and they will pay good money for this right but, as the government tries to squeeze taxpayers for more than what they perceive is fair, animosity will begin to build, Olsen predicts.

This deficit reduction strategy can be found in areas represented by both sides of the aisle, and on the state level as well. Here are some things to know if you receive an audit notice:

Do not panic. Many of these notices can be dealt with simply and painlessly. Still, you might want to contact an attorney or CPA. There are a number of reasons why the IRS might send you a letter. Notices may request payment of taxes, notify you of changes to your account, or request additional information. The notice you receive normally covers a...