Will You Get Audited?

//Will You Get Audited?

Will You Get Audited?

The easy answer to this question is most likely, NO!

Recent analysis of IRS data shows that less than 1%, about 1 out of every 104, tax returns get audited. Because of IRS budget cuts and other factors, random audits are very rare. Certain taxpayers and certain items (red flags) raise your audit chances.

Taxpayers with income over $200,000 have a 1 in 30 chance of being audited while taxpayers with income over $1 million have a 1 in 9 chance of being audited.

Some of the deductions that could trigger an audit include deducting large amounts of charitable donations compared to your income, claiming rental losses, claiming hobby losses, and taking higher than average deductions in general. I R S has data that shows what the typical deductions are for every income level and amounts outside these norms are subject to more scrutiny.

Small business owners are also subject to higher audit rates. The areas that IRS looks at closely include deduction of an office in the home, meals, and entertainment and the business use of vehicles (especially 100% business use).

If you are a small business owner or individual and have any questions or concerns about the possibility of an IRS audit, please contact our office at 513-576-6770. Our CPAs and tax professionals have experience in protecting our clients as well as expertise in advising small business on tax, accounting, and management strategies.

 

IMAGE: Pixabay / CC0 Public Domain

By |2017-11-17T12:45:06-05:00June 17th, 2016|Income Tax|0 Comments

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