Chance of Audit Declines

April 21, 2014

Chance of Audit Declines

From: ACCOUNTINGTODAY.COM

By: Michael Cohen, Editor-in-Chief

Washington, D.C. (April 17, 2014)

The Internal Revenue Service is anticipating the chances of a tax return being audited to be the lowest in years. The IRS audited less than 1 percent of individual tax returns in 2013, the lowest rate since 2005, and the number of individual returns that will be audited this year will decline even further, IRS commissioner John Koskinen told the Associated Press.

Thanks to successive rounds of budget cuts at the hands of Congress, the IRS has been forced to cut back on its audits. “We keep going after the people who look like the worst of the bad guys,” Koskinen told the AP. “But there are going to be some people that we should catch, either in terms of collecting the revenue from them or prosecuting them, who we’re not going to catch.”

Last year, the IRS audited just 0.9 percent of individuals who earned less than $200,000 a year, the lowest rate since 2005. The odds of being audited were more likely for high earners, but while 10.9 percent of individuals who earned $1 million or more were audited last year, that was the lowest proportion since 2010.

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