08/22/2021
“You’re Being Audited”
Words that cause taxpayers to cringe. The percent of people who are actually audited is less than 1%, according to the IRS, but there are Red Flags that cause a greater risk of audit.
Math Errors and Failing to Sign the Return. While this may sound simple, many returns are selected for audit due to math mistakes. The IRS’s computers are very good at finding math mistakes! Further, many people simply forget to sign their tax returns which almost guarantees scrutiny.
Complete Information. The IRS has a great deal of information on us. Because of this, the IRS computers are looking for things they expect to see in our personal and business returns (i.e.; W-2s, 1099s, 1098s, incomes, expenses, and credits, etc.). Incomplete returns cause the IRS to take a closer look.
Amended Returns and More Complex Tax Structures. Small W-2 taxpayers have almost no audit risk, but AGI over $250,000, self-employed, credit use, passive income, NOLs, partnerships, corporations, trusts, or other complex issues greatly increase audit risk. Also, amended returns certainly increase audit risk and are assigned manual review.
It’s important to note that not all audits are created equal. There are different types of audits in increasing levels of complexity: Correspondence, Office, Field – very broad, and multi-national.
If you are being audited – immediately call the skilled attorneys at Tax Solutions Attorneys and let us help you save money.
