While just the prospect of an audit is enough to strike fear in taxpayers’ hearts, the truth is that less than 2% of taxpayers get audited a year. The IRS is tight-lipped about exactly what gets your tax return selected for extra scrutiny, but tax pros say it’s an ever evolving combination of factors. None of these red flags are likely to be enough by themselves to earn you an audit, but the more you have, the likelier you are to be tagged for greater scrutiny from the taxman.
The tax code is over 60,000 pages long. No wonder there’s a little confusion as to what’s taxable, who is most likely to get audited, and what you can claim as a deduction.
