Ever been audited by the IRS?

[gotdurt]

Just finished reporting to the thieves we call 'government', and was wandering, how often do folks really get audited? Someone from H&R Block once told be that it is highly unlikely unless you're making well into 6 figure income. It seems to me though that more mistakes and cheating would come from those sub 6er's that do their own taxes. Stories?

[kurt]

I just did mine. :shock: A few years ago, I didn'make as much gross as I pay every year now. :angryfir:

[Tx Rider]

Got audited once about 12 years back, they wanted $5k, I ended up paying $500.

Big refund this year.

[gotdurt]

Got audited once about 12 years back, they wanted $5k, I ended up paying $500.

Big refund this year.
If you don't mind my asking, what flagged them? Did you have your own buisness?

[M2]

I not only just filed my 2004 taxes, I also filed my 2003 and 2002 as well! :eek: I gotta say I've been just a bit busy over the past few years, but hopefully I will stay caught up now that I have caught up! :angel:

Honestly, I don't expect to be auditted either, even though I will probably get back close to $8500 for each year (enough to buy a new BMW K1200S when you add it all up! :chug:). Not like there is a reason to in the first place...we were actually talking about this very subject today and everyone agreed that it would probably not be worth the IRS's effort to scrutinize our taxes...at most any errors would probably cost me a hundred bucks or so. Plus, my taxes have been completed by a military legal office for every year of the past 15, so there is some element of "trust" amongst government agencies!

Cheers! Maj M2

[John Bennett]

Just finished reporting ...and was wandering, how often do folks really get audited?

Pushing the envelope this year eh? :-D

My mother was an IRS auditor for many years. She's retired now.

The IRS uses a complicated forumula for selecting which returns to audit.

After your return is punched in by some illegal immigrant working for a government contractor, the computer applies the forumula. If your return fits too well, it gets flagged.

* a certain percentage of returns get flagged totally randomly.
* most returns get flagged because they have obvious errors
* some returns get flagged because they have wild claims (26 kids, etc.)
* some returns get flagged because they fit the profile so well.
(this is the one you are worrying about)

The percentages vary, but the idea is that anyone can get audited, but certain profiles do get flagged more frequently. They try to disperse these flags across all geographic regions and economic classes, but they do of course focus on some types of people more than others.

The two groups my mother hated auditing the most were Preachers and Teachers.

Preachers because they were THE most heinous and blatant violators (It's their right, by God).

Teachers because you can't tell them anything. They already know it all.

Dang! I need to get her to do my taxes before Friday!

[Tourmeister]

we were actually talking about this very subject today and everyone agreed that it would probably not be worth the IRS's effort to scrutinize our taxes...

:tab Since when does a cost beneift analysis have anything to do with what the gubment will and won't do?? :scratch No pinhead beaureacrat stops to think it will cost thousands of dollars to go after a few hundred. If it were known that this was how the IRS operated, then EVERYONE would be underpaying their taxes like crazy knowing that it would cost the IRS too much to come after them. So they try to do it randomly to keep us afraid of being audited. The cost of the audits being justified against the larger picture, that of money paid in out of fear that might not otherwise be paid if there were no audits.

:tab I despise our current income tax system. It is inherently unfair and arbitrary in its application. Defining "taxable income" is such a vague game that it always favors the people with the time and money to hire experts to help them reclassify their wealth as deductions to reduce their taxable income. I would be thrilled if they simply did away with the Federal income tax system and replaced it with a sales tax system. It would be much harder to commit fraud, the costs of collection would drop substantially, we would not need anywhere near the bloated beaureacracy and tax courts. But there are far too many special interest groups that benefit fromt he current system to let it go.

:tab whew... I need a beer...

Adios,

[bluedogok]

My parents got audited a few years ago. It was due to a disbursement from a pension plan that was being terminated since the company had gone to a 401K plan. Only the long timers like my dad (and 23 others in a company of 800) were still in the pension plan. Everyone got audited. All they had to do was show evidence of it being placed into a rollover in an approved IRA or similar plan (which they did).

[gotdurt]

My mother was an IRS auditor for many years.
I won't hold that against you...


* some returns get flagged because they fit the profile so well.
(this is the one you are worrying about)
Well, if I fit a "profile". I really wasn't real concerned until now.... :roll: My concern is this:

For about the past 6 or 7 years I have had to pay out at tax time, between $1k-2k/yr. Every year was pretty consistant. Things changed last year though. My wife lost her job, we bought a house, had a baby, I started a side business (or made it legit :roll: ), totaled a car that wasn't paid for (deduction; didn't have full coverage ins), and as a result are getting $1500 back for once. We went question by question with Turbo Tax, but all these changes and deductions scare me.... :-? . It seems that this would be the kind of thing to set off a flag...

[HotChickenStrips]

by some illegal immigrant

Just gotta get it out of your chest,eh?

[Tourmeister]

Let's let the immigrant thing go please ;-)

[M2]

Actually, I saw a 60 Minutes segment which said a lot of the processing was being outsourced to Pakistan or India (can't remember which). They are no illegal immigrants as they still reside in their own country...

And having lived in Germany and Belgium for seven out of the last ten years, I realize we don't have as much to complain about as we do! Those countries tax the bejesus out of their citizens, much more than we do. But please, that is not an invitation to turn this into a debate on the US tax system!

Cheers! M2

[BrutusTx]

Well, I was audited about 15 years ago when I was making about 25,000/year. I don't believe it has anything to do with your income, I think it's just the luck of the draw. They audit a certain percentage every year I think.
It was NOT a fun experience.

[HotChickenStrips]

Let's let the immigrant thing go please

Alright, alright Scott, i'll behave this time. :angel:

I never got audited, but onetime i got a Notice of levy letter from the IRS because i forgot to mail a payment...being single, no dependents and making 50k+ sucks when you are doing your taxes every year.

[gotdurt]

Food for thought:

http://www.devvy.com/notax.html
http://www.fff.org/freedom/0500a.asp
http://www.buildfreedom.com/fiscal/suprynowicz.html
http://www.freedomabovefortune.com/
http://www.geocities.com/libertarian_press/incometax.html

These are just a few of many convincing sources I came accross this morning regarding "voluntary income tax".
I haven't had time to absorb all of it, but I can tell you that my bitterness toward the "federal mafia" grows with every word I read...

You know, it's funny, if as many people who claim to lean libertarian actually voted libertarian, I believe things would change.

[scratch]

Great rant about income taxes on Blue Eyed Infidel's blog:

http://www.blueeyedinfidel.com/archives/2005/04/i_should_sue_th.html

This girl really knows how to spew some venom! :eek: :mrgreen:

[gotdurt]

Great rant about income taxes on Blue Eyed Infidel's blog:

http://www.blueeyedinfidel.com/archives/2005/04/i_should_sue_th.html

This girl really knows how to spew some venom! :eek: :mrgreen:

OMG, I think I love her. :kiss:

Ha, go to the main page, scroll all the way down, click "see the rest". :rofl
She's quite the character.

Sorry, kind of jacked my own thread...

[scratch]

Ha, go to the main page, scroll all the way down, click "see the rest". :rofl
She's quite the character.


Oh yeah; the conversation about wood. That's a classic. ;-)

[Aileron]

That's Rachel Lucas from Dallas - here's her old site:

http://www.rachellucas.com/

And yes, she is a funny gal.

[gotdurt]

Here you go Scott.
http://www.fairtax.org/
This guy was just on the Glenn Beck program. Sounds really good.

[TexasFatBoy]

Well, if I fit a "profile". I really wasn't real concerned until now.... :roll: My concern is this:

For about the past 6 or 7 years I have had to pay out at tax time, between $1k-2k/yr. Every year was pretty consistant. Things changed last year though. My wife lost her job, we bought a house, had a baby, I started a side business (or made it legit :roll: ), totaled a car that wasn't paid for (deduction; didn't have full coverage ins), and as a result are getting $1500 back for once. We went question by question with Turbo Tax, but all these changes and deductions scare me.... :-? . It seems that this would be the kind of thing to set off a flag...

Heck, if that's all it took to get flagged, I woulda been audited long ago. I went from years of having only $12,000 total income to three times that in less than two years. Then I dropped to no income at all for three years and then started back with a very substantial income right off the bat. I've had years where I've paid the gubment a few hundred in additional tax at tax time and years where I've gotten substantial amounts back.

I wouldn't worry too much about it, but that's just my .02

[texasyankee]

People think the IRS has more capability than it really does. Because its computer system is so old, it has no ability to compare one year to the next . When a taxpayer is audited, the auditor is sent a copy of the return being examined, but he has to ask the taxpayer for the other open years because it takes 3 to 6 months to get copies from storage.

I have been a tax accountant for the past 25 years and have not found any rhyme or reason in how the IRS selects taxpayers for audit except failure to report whats on Forms 1099. Some preparers, myself included, believe people who use paid preparers are less likely to be audited than those doing it themselves. I know that over the past 15 years, the number of my clients that have been audited is less than one would statistically expect.

Just as a person should never go to court without a lawyer, a person should never try to handle an audit by themselves. Almost all the horror stories about the IRS come from people who tried to handle an audit or a problem by themselves.

[Anonymous]

Yes. The last time was MANY years ago, the last time a joint return was filed...reason OBVIOUS of course. Auditor came up with a tax bill of $300 owed, said: "You pay $150 and we WILL collect the rest from her." I called her and told her. She replied: "Like **** they will!." They never contacted her. About six or seven months later, I got a check in the mail from the IRS. They returned my $150.00. Now... THAT's an IRS story for you and it happens to be TRUE.

DocJR