Every year, over 140 million income tax returns are filed with the Internal Revenue Service (IRS). Of those 140 million returns, nearly 1.5 million are audited by the IRS. Taxpayers with an adjusted gross income of over $200,000 generally have a higher chance of being audited, as well as taxpayers will little or no adjusted gross income.
Although the probability of actually being chosen for an audit is relatively low, it is still important for taxpayers to understand what tax auditing entails, the procedures the IRS takes in determining which tax returns to audit, and the IRS’s process in selecting the outcome of the audit.
This way, taxpayers are able to indicate the common red flags of the IRS and can greatly minimize the possibility of being chosen for a tax audit.
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