Bookmark this page
The 2012 tax filing season has just begun, but a perennial concern is on the minds of many filers: audits.
The good news is that if you make less than $200,000, your chances of the Internal Revenue Service taking a closer look at your return is negligible.
The latest IRS data on examinations – that's what the IRS calls audits – show that the tax agency is focusing on returns reporting more money.
The IRS audited 12.5 percent of millionaires in fiscal 2011. That was a 4.5 percent increase from millionaire audits in 2010 and more than double the number of such returns the IRS examined more closely in 2009.
The news is a little better for those making just a fraction of that. Around 4 percent of taxpayers who earned $200,000 or more were audited. That was a slight increase from the previous fiscal year.
But filers who earned less than $200,000 apparently are off the IRS audit radar. Only 1 percent of taxpayers making less than $200,000 have been audited over the past five years.
Avoiding an IRS audit is no reason to turn down a raise. But at least you and I can take some comfort in knowing that our lower salaries protect us from added IRS attention.
Do you worry about an IRS audit? Have you ever passed up a tax break because you thought it might make you audit bait?
Some taxpayers find that hiring a tax pro helps them avoid mistakes that could lead to an audit. Find out about your tax professional choices in today's tax tip.
You can get a new tax tip each weekday by subscribing to Bankrate's free tax newsletters. You can sign up to get a Daily Tax Tip. Or if you prefer a more consolidated collection, subscribe to the Weekly Tax Tip newsletter. Or sign up for both.
You also can follow me on Twitter @taxtweet.
