Friday, March 29, 2013

IRS releases data on audit rates

We’re kicking off a timely series on Internal Revenue Service audits with this post on the IRS’s recently released 2012 Data Book.

This annual report, which details the IRS’s activities for the year, is full of interesting tidbits. For example, between Oct. 1, 2011 and Sept. 30, 2012, $2.5 trillion in federal revenue was collected by the IRS, which also handled 237 million returns.

I’d like to draw your attention to the data released about the IRS audit rates. The infographic below shows the audit rates for individuals and businesses.

The good news is that the overall percentage chance of an IRS audit remains low. However, the IRS enforcement division has increased the number of audits over most categories in recent years as the agency works to close the tax gap. 

The tension over facing an IRS audit is one reason why we will soon write about common audit red flags, how to prepare for an audit, and your rights during the process.

Be sure to check back to read the other posts in this series.

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