Tax Tip: Preventing an Audit
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iStock/Thinkstock(NEW YORK) — The chances of receiving an audit notice from the Internal Revenue Service are lower than most people think.
“We audit about one percent of returns every year,” says IRS spokesman Eric Smith.
That number is the lowest rate since 2005, in part because the IRS says budget cuts have it operating at its lowest level since 2008. That means roughly 46,000 audits will fall through the cracks this year.
Smith says if you do get audited, good record-keeping is always worthwhile.
“If you have good records, chances are you won’t have a problem,” he says. “If you can verify the deductions that you took, the credits you claimed, that’s what we’re going to be looking for.”
Accuracy is another thing the agency likes when examining tax returns.
“When your return is right to start with, the chances that you’ll hear from the IRS in any fashion really go down,” Smith says.
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