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How to Prepare for an IRA Audit

Prepare for IRA audits with confidence. Learn what auditors review and how to keep payroll, ratio, and apprentice records ready.

Updated over 2 months ago

Audits are part of the compliance process for projects covered by the Inflation Reduction Act (IRA). Preparing in advance ensures you can respond quickly and confidently if the Department of Labor (DOL) or IRS reviews your project.


What Auditors Review

Auditors typically request documents to confirm:

  • Prevailing wage compliance through certified payroll (WH-347)

  • Apprentice registration and progression through signed agreements, Appendix A wage schedules, and Davis-Bacon certificates

  • Ratio compliance between apprentices and journeymen (verified on daily payroll records)

  • Apprentice labor-hour percentage compared to total project labor hours


Key Steps to Get Audit-Ready

1. Organize Your Records

  • Store apprenticeship documentation in Apprentix (agreements, wage schedules, certificates).

  • Maintain payroll and wage compliance files with your payroll provider.

  • Confirm apprentice hours logged in Apprentix match certified payroll totals.

2. Confirm Apprentice Statuses

  • Make sure every apprentice is registered and active in Apprentix.

  • Update statuses (suspended, canceled, or completed) within 30 days.

  • Keep Davis-Bacon certificates current (renew every 90 days).

3. Monitor Ratios and Hours

  • Track daily 1:1 apprentice-to-journeyman ratios.

  • Review weekly hours to confirm at least 15% of labor hours are performed by apprentices (10% if project began before 2024).

4. Document Corrections

  • Keep proof of any back wage payments or reclassified apprentice hours.

  • Include memos or correspondence explaining corrective actions.


Best Practices

  • Run internal compliance checks monthly to confirm all records are up to date.

  • Use Apprentix notes fields (e.g., “Matches payroll MM/DD/YY – MM/DD/YY”) to make auditor reviews simple.

  • Assign a primary compliance contact within your company to coordinate responses during an audit.


Why It Matters

Being prepared reduces stress and prevents delays in receiving IRA tax credits. Contractors who keep accurate records and align Apprentix data with certified payroll rarely face penalties or disqualification.

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