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re: Anyone ever been audited by the IRS?

Posted on 7/18/08 at 2:12 pm to
Posted by Poodlebrain
Way Right of Rex
Member since Jan 2004
19860 posts
Posted on 7/18/08 at 2:12 pm to
There are several ways your return can be selected for audit. The most common reason a return is selected is if the taxpayer reports income from a closely held business that engages in a high volume of cash transactions like the sole proprietor of a tavern. The potential to under report income is the justification for the audit. A second method is if the IRS suspects you haven't filed a complete and accurate return due to omitted information the IRS knows should be on your return. Another method is if your return contains too many abnormal amounts, or statistical outlayers. The IRS tracks all sorts of statistics and if you claim outrageous dedcuctions relative to your income you have a chance of being selected for audit. Another method of being selected for audit is if someone rats you out to the IRS. And there is also just random chance. The IRS selects a few audits randomly.

The good news is that the IRS has only so many examiners in each region, and the number of audits conducted are a function of the number of examiners. In Louisiana there are currently too few examiners in the individual and small business area to meet the IRS's numerical goals for audits. So your chances of being audited are pretty remote.
Posted by Meauxjeaux
98836 posts including my alters
Member since Jun 2005
40471 posts
Posted on 7/18/08 at 3:07 pm to
You can say that again...
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