Last night I was reading an interesting article about audits. (Ok, interesting to me.) And the article talked about how 70 percent of taxpayers don’t get audited. While that number may give you comfort, it actually made me pause.
That means we have a thirty percent chance of being audited.
And these numbers were based on records before the IRS received all its additional funding.
But it is not all doom and gloom.
You see, the beauty of the IRS is that it is a big machine with rules and procedures. And you can use that knowledge to your benefit.
Nugget of Knowledge #1 – we all have an individual tax record with the IRS similar to our credit report, but this is your tax report.
Nugget of Knowledge #2 – the IRS inputs all their activity in your tax report, including when they pick up and review your tax return. Yes, that is correct, even when they are just looking at your tax return.
Nugget of Knowledge #3 – reviewing your tax return could be a precursor to an audit.
Nugget of Knowledge #4 – the IRS doesn’t send you a letter to let you know they are looking into your tax return. But the IRS will send you a letter when they open an audit.
So, if you can tell when the IRS reviews your return, you can check your tax return yourself to see if you need to fix anything.
And you can easily do this by logging every day into the IRS website and checking all your tax records for the last 3-4 years and see if one of the tax audit codes shows up in your transcript. . .
Or you can subscribe to our program, My Tax Alarm, and let us do the legwork for you.
To your clarity,
P.S. If you are ready to use the above nuggets of knowledge to your benefit and you want us to do the work for you, sign up for My Tax Alarm today.