The IRS will be even slower in processing returns this year. It has less resources and less staff than prior rears leading to a reduction in timeliness and efficiency. This has also led to a reduction in the number of tax returns it can examine by hand. Due to this lack of resources, taxpayers face a greater risk of being audited.

Hire A CPA

An audit may occur if there are any red flags on your tax return. Taxpayers in the high income range, with a salary over a million dollars, are who will probably be audited. There are ways to increase chances that you will not be audited. Hire a CPA or small business CPA in South Jordan to assist you in understanding the auditing process and to help you avoid a tax audit.

The best advice to avoid an audit is to blend in. Ensure that you are inside the norms of examination for your income level. Make sure that your deductions make sense with your income, especially if you are a small business owner. Also, be sure that you remember to report all items on your tax return that are automatically reported to the IRS such as pensions and charitable donations.

Ensure that your math is accurate on your tax return as well. Have a small business accountant go over your calculations to confirm accuracy. There are other accuracies to look out for as well such as entering correct identification data and utilizing the correct forms for your return.

Small Business Tax Preparation

If you are a small business owner, you run the risk of having a more complicated tax return. You will have to report expenses, income and sales. Someone with a higher salary will also have a more complicated return. Forms need to be filled out accurately, however, which a small business CPA for small business owners or a CPA for those with high incomes can assist with.

After submitting a return, also make sure it is submitted before the deadline, you may catch a mistake. If this is the cake you are able to file an amended return. This amended return will take longer to process but will help you to avoid a tax audit.

What The IRS Focuses On

The focus of IRS audits is slowly changing to a focus on small business owners. This is due to the lack of itemized deductions being utilized as these were misused in the past. It is important to note, however, that there are less tax audits overall. They do still occur though, especially among business owners and individuals with high salaries. Correspondence audits are becoming more common, however, with more notices being sent out each tax season.

Correspondence audits are more likely with a claim of the earned income tax credit. It is a very complicated credit which can lead to payouts that are too high. Rates have fallen to .45 percent of taxpayers receiving audits and 6.66 percent of high salary taxpayers receiving audits, giving taxpayers good news overall. The loss in staffing and resources is likely to blame. If you are a small business owner, however, be sure that you hire a small business accountant to completely avoid an audit. If you are a high income earner, hire an accountant to help you avoid an unnecessary audit.