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1% audit chance for returns under $200,000

Associated Press / December 23, 2009

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WASHINGTON - Want to keep IRS auditors away? Keep your earnings under $200,000 and they won’t bother you 99 percent of the time.

IRS enforcement numbers, released yesterday, show that returns under that amount have a 1 percent chance of getting audited.

Returns showing income of $200,000 and above have a nearly 3 percent audit chance. The percentage jumps to more than 6 percent for returns showing earnings of $1 million or more. The percentages apply to both individual and joint returns.

The number of audits jumped 11 percent from 2008 to 2009 for returns with earnings of $200,000 or more, but rose 30 percent for returns showing earnings of $1 million or more. For those under $200,000, the number of audits remained steady.

The IRS conducted 1.4 million audits of individual returns in the financial year ended Sept. 30, with more than 1 million conducted through correspondence with the taxpayer. The others were conducted through face-to-face meetings with IRS auditors.

The IRS does not do random audits, but does conduct “research audits’’ that will test compliance in business tax categories.