What Are the Chances That Your Income Tax Return Will Be Audited?

What Are the Chances That Your Income Tax Return Will Be Audited?

For the vast majority of taxpayers, there is no need for excess worry that you will be audited. In recent years, only about 1% of all taxpayers received audit notices. Why? For one reason the IRS budget has been cut, resulting in more than 2,200 fewer agents available to audit returns. Nevertheless, certain taxpayer groups are more susceptible to catching the attention of auditors.

Returns that report more than $10 million in income or-report no income Sixteen percent of individuals who reported over $10 million in income were audited in 2014. Surprisingly, those returns that reported no income were audited at a higher-rate than the average person. In 2014, 5.3% of tax returns with no income reported were audited.

If your income is $25,000 – $200,0 00, you’re highly unlikely to be singled out for an audit.

Estate Tax Returns of more than $5 million

In 2014 the IRS did an audit on 8.5% of estate tax returns which was well above the .9% of individual returns. Even larger estate tax returns, 21% of those between $5 million to $10 million were audited, while 27% of those over $10 million received an audit.

Individual filing of international returns raises a red flag

The IRS is focusing more attention on international returns. Statements made by experts in the field, strongly emphasized the practice of offshore tax evasion as being fundamentally unfair. Wealthy people evading the law by stashing their money overseas and not paying their share of tax is forcing the bulk of lower income citizens to foot the bill to fund the government. In 2014 only 4.8% of the international returns were audited. Long Island Traffic Ticket Lawyer

Errors in information entered

Simple careless mistakes in filling out income tax forms are made which send up red flags to the tax auditors.

Leave a Reply

Your email address will not be published. Required fields are marked *