What are the chances my tax return will be audited?
Slim to none. The IRS ran just one of every 175 individual returns through the audit wringer last year, and even those odds vastly overstate the risk. About two-thirds of the challenges were “correspondence” audits, in which the IRS sends a letter asking for backup information concerning something on the return. The odds are about 600 to 1 against having any face time with an IRS agent. Those are overall averages; the audit rate varies according to the type of return filed and the amount of income reported. For example, the IRS bragged earlier this year that in 2002 it increased by 22% the number of audits of taxpayers reporting income of $100,000 or more. Still, only about one of every 120 of those returns got “the business,” and 40% of those were correspondence audits.
Related Questions
- The entity tax return is being audited and wants the tax professional to handle the audit. How can the entity give the department authorization to talk to the tax professional about the tax return?
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- What are the chances my tax return will be audited?
