Here Are Some Myths About Tax Audits

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Some Myths About Tax Audits
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OVERVIEW
You dont need to worry about IRS audits at all.
The audit is the most dreaded outcome of the tax
filing process and the situation carries with it
some unsettling mystique. The standard nightmare
has IRS agents with badges coming up to your
doorsteps, or the agency or the agency seizing
your personal assets. One of the common myths
related tax audits is that the audit is a common
occurrence. In reality, only one percent of
filers get audited. Thats really a small
percentage. Even though IRS audits only a small
percentage of filed return, there is a chance the
agency will audit will audit your own. The myths
about who does or who does not get audited and
involves some myths.
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Be Very Afraid Of An Audit
The looming myth here suggests the audit process
is something you must be afraid of. The is that
most people only respond to a few IRS questions.
Even if you receive a paper from the IRS you must
not break down into a sweat. The correspondence
audit is the more common of the two IRS audits.
The other is the in-person audit. The IRS will
request an appointment with you to review some
financial information. Most of the times it is a
very simple problem to resolve. So, the IRS can
send you a letter asking for information and
refund because they lost the money on sale.
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Professionally filed returns are audit-proof
You have come across people who thought that
relying on the tax service guaranteed a solid,
mistake-free return. The easiest way for these
places to compete is to advertise that they are
going to get you the biggest refund. Most people
get excited about getting a refund. In fact, the
tax payers dont understand what they are
claiming on their returns. Such steps trigger an
audit, interest and tough penalties.
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Those with low to moderate incomes don't get
audited
The IRS has revamped up the number of tax audits
it does in response to the countrys economic
woes. That means people shouldnt think theyre
in the clear if they dont earn a lot of money.
The IRS is doing audits across the board for all
incomes. In fact, they have been hiring more
people for that. Now, even though the IRS has
increased the level of auditing, the number is a
very small percentage of the returns filed.
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Filing for certain deductions or credits
increases the chance of an audit
Many people avoid taking certain credits and
deductions- denying themselves tax advantages to
which they are entitled- because they believe or
have heard that taking them will make them
susceptible to an audit. Fear of an audit would
cause people to hand money over to the
government, money they were entitled to. However,
only when the financial picture painted in the
tax return stands out as typical or beyond common
sense should someone be concerned about the
audit.
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Audits Are Done Immediately
The IRS abides by a statute of limitations of
three years after the due date of the return. For
substantial errors, the IRS maintains it can go
back to six years and recommends you keep most
records at least that long. As per the experts,
if the audit is happening, it will occur in the
latter half of the three-year time frame.
Generally, audits happen two years after you
file. It takes a while for all these filings to
get done and the computer to get through this
process.
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Thank You
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