Many Americans are worried about their tax return being audited by the Internal Revenue Service. While many of us are fearful of the audit process, what are the chances of you actually getting audited? Not likely, according to the IRS.
Last year, less than one percent of taxpayers were audited by the IRS. The IRS said they are conducting fewer audits because they do not have as many auditors as they used to in the past. This means that possibly less than one percent of tax returns this year will be audited.
Even though the IRS will only be auditing roughly one percent of tax returns this year, you may still be at risk for being audited. How do you know if you have a higher chance of being subject to an audit? Below is a list of which groups are more likely to be audited by the IRS:
- Reporting no income or more than $10 million
- Filing estate tax returns worth more than $5 million
- Filing international returns
The income you report on your tax return can play a role in the chances of getting audited. While some may think only wealthier individuals are at risk, this is not true. Not reporting any income can also be a red flag for the IRS, which can result in an audit.
Filing a tax return on a bigger estate can also increase your chances of an audit. This is likely because you are reporting a larger amount of assets, which can be a red flag for the IRS.
International tax returns are also a red flag for the IRS due to growing concerns of offshore tax evasion. Last year, the IRS audited fewer than five percent of international tax returns, according to a recent report.
If you think you are at risk for being audited or have received notice from the IRS of an audit, you should consider contact a tax attorney to protect your best interests.