One factor currently influencing the growth trajectory of the audit is IRS budget cuts. While this seems like a positive development (just .86 percent of all individual returns were audited last year), this number actually breaks down to 1.1 million returns audited for taxpayers earning under $200,000 per year and only 34,000 returns audited for taxpayers earning over $1 million. This means that even though the total number of IRS audits has been reduced, the IRS is increasingly targeting a more common taxpayer, most likely one with less resources and time to legally defend themselves against an audit. This CNBC article gives a number of examples of common mistakes that taxpayers make on tax returns that, when avoided, can help prevent triggering an audit.
About Five Stone Tax Advisers
Five Stone Tax Advisers has years of experience negotiating directly with the IRS to get the best possible outcome for you. Our International Tax Advisory and Compliance unit has a team of tax attorneys, certified public accountants and enrolled agents that form a single sourced point of contact that will provide services for all the legal, compliance and financial reconstruction aspects of offshore account cases.