Litigation

Tax Audit Red Flags

By Tracy Coenen

As tax day nears…. taxpayers around the country are in a panic. Some because they’re not ready for April 15. Others because they’re deathly afraid of being audited. Here are some common audit red flags to ponder.

The IRS purposely doesn’t definitively say what things make you more likely to be audited.
Since our tax system relies on voluntary reporting of income (i.e. you volunteer your tax information to the IRS and tell them how much you owe), the IRS uses the fear of audits to scare people into being honest. But tax preparers can see patterns in the IRS audits, so that’s how we come up with these lists of red flags. (more…)

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Full post as published by The FRAUDfiles Blog on April 09, 2008 (boomark / email).