IRS Steps Up Audit Enforcement

Over the past few years the IRS has added roughly ten percent additional enforcement staff positions bringing the total number to just under 23,000 positions.  The audit rate was 1.11 per cent of all taxpayers last year, but for certain groups such as those who operate their own business the audit rate is just over four per cent.  The IRS estimates that Schedule C filers understate their income by about $69 billion a year.  Although the numbers are still small, IRS audit representation can be costly and it is important that you have your returns prepared by someone familiar with all pertinent sections of the tax code and IRS regulations regarding self-employed taxpayers.