To Be or Not to Be – Audited

It's not that I have anything to hide, but the prospect of an audit just doesn’t sound very pleasant. Although I have some friends who tell me that their audits were pain free, I nevertheless hope to avoid the experience.

My curiosity led me to Google a search about the odds of an audit. Here is what I found in a Washington Post article written by Christopher Ingraham.

“The Associated Press reported Monday that your chances of getting audited are the lowest in years. ‘This year, the IRS will have fewer agents auditing returns than at any time since at least the 1980s,’ the report says. Noting that less than one percent of individual returns were audited last year, the story quotes IRS Commissioner John Koskinen as saying that the audit rate will be even lower this year.”

If you want some historic perspective, the IRS doesn't make it easy. It has reported on annual audit rates for decades, but these figures are buried deep within PDFs of its annual reports. I dug up the audit rates going back to 1980, which I charted below.

April 17th
 

Last year did indeed mark the first time audit rates dipped below one percent since 2006. But the rate was even lower in previous years, bottoming out at 0.49 percent in 2000. Audit rates were highest over this time period in the early 1980s, when more than 2 percent of individual returns were examined by auditors.

Audit rates differ by income. The IRS doesn't provide consistent income breakdowns of the audit data over time, but in 2013 your chance of getting audited was 0.88 percent if your income was under $200,000, 3.26 percent for incomes greater than $200,000, and 10.85 percent for earners making over $1 million per year.

In sum, you're about half as likely to get audited today as you were in 1980, but twice as likely as you were in 2000. If you get audited this year, congratulations! You are the one percent – at least when it comes to tax filers.”

This was an informative article and I hope it relieves some anxiety… except, of course, for those of you who make more than 1 million a year. 

Have a Happy Easter or Joyous Passover or a Great Weekend!

 


DMPhotoWorkPuzzleEditor's Note: This article was written by Dr. David Mashburn. Dave is a Clinical and Consulting Psychologist, a Partner at Tidemark, Inc. and a regular contributor to WorkPuzzle.