International taxpayers—such as U.S. citizens abroad, green card holders overseas, and nonresident aliens—may be called in for office audits. These in-person audits generally take place at a local IRS office in the United States, usually when the IRS identifies significant or complex issues on the return. These might include U.S.-source income, Foreign Earned Income Exclusion claims, foreign tax credits, treaty benefits, deductions, or problems with international reporting.
An office audit usually takes place at an IRS office, where you meet with an IRS examiner to review specific items on your tax return. However, the IRS generally tries to make the audit process as convenient as possible. If you live outside the United States and have a foreign address on file, the IRS will likely conduct the audit by mail rather than require you to travel to the United States.
If the scheduled date, time, or location is inconvenient, contact the IRS examiner as soon as possible to request an alternative arrangement. Depending on your situation, the IRS may agree to conduct the audit by mail, by phone, or through a video conference.
If the IRS sends an audit notice to your last known U.S. address while you are living abroad, you should contact the IRS as soon as you become aware of the notice. It is important to explain that you currently reside outside the U.S. and to ask whether the audit can be handled by mail, phone, or another remote method. It is also recommended that you update your address with the IRS, for example, by filing Form 8822. This may ensure future notices are sent to your current foreign address.
Since most foreign taxpayers live overseas, it’s a good idea to appoint a U.S.-based attorney, CPA, or Enrolled Agent to attend the meeting for you using Form 2848 (Power of Attorney), so you likely don’t have to travel to the U.S.
Next, let’s understand the IRS field audit procedure.