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This Web site contains a compilation of more than a thousand consumer finance  columns written by Tony Novak from the 1980s through 2006, updated and reformatted for maximum usefulness today.  New material was added after 2010.

Content is the opinion of the author and does not represent the position of any other person or entity. Information is from sources believed to be reliable but cannot be guaranteed.

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Risk of tax audit

originally posted: 11/22/2006  reposted: 2/18/2011 This post has not been recently reviewed or revised by the author and may be out of date. If in doubt, please send a new question or ask for an update.

Q: What is the percentage chance of being audited by the IRS?

A: The chances are less than 1 in 100, assuming there are no problems with the return that would create a machine-generated audit (like listing the wrong social security number). The IRS selects about 1.5% of tax returns for filers with income above $100,000 these tax returns for audit. Most audits are handled entirely by mail and a large number of these audits are for failure to file a specific type of income tax return (for example, a corporation with reported income suddenly stops filing a tax return). The chances of a face-to-face audit are actually much less than 1%. Taxpayers with incomes less than $100,000 face even lower chance of an audit. The best way to protect from an audit is to have your tax return reviewed by a tax adviser other than the person who prepared the return. OnlineAdviser offers this service for a flat $150 that includes a written report of the audit findings and a listing of any tax-saving strategies that might not have been taken.


More resources:

OnlineAdviser service details