Do You Feel Lucky? No one wants to be audited. And yet as a tax lawyer advising clients about tax issues, I’m required by Treasury Department rules to assume every return will be audited. In truth, there might be only a 2% chance of audit. When I say there’s a 50/50 chance a tax deduction will be upheld, I must assume it will be examined.
Because of these strict standards, it can be awkward to talk about audit risk. But understandably, no matter how sure you are of your return, you don’t want to be audited. You want your return to look plain vanilla, and nothing prevents you from trying to make it sail through as long as you fully and fairly complete it. See 10 Ways To Audit Proof Your Tax Return.
Audit Witchcraft? There are many old wives’ tales about what does and doesn’t trigger an audit, but the latest IRS stats are worth a look. The IRS has pulled back the shroud on audit rates in its 2010 Data Book, providing important clues about your chances. The numbers reveal some surprising percentages.