Audit 2012: Your Odds of an Audit are Going Up Worried about a tax audit? Now more than ever there is cause for concern. In large part because of the long recession, the Obama administration is in huge need of tax dollars to keep the government going. Thus, more Americans than ever may be subject to unwanted attention from the Internal Revenue Service this season as the government pumps billions of dollars into tax collection. My name is John Ellsworth and I am a tax lawyer who specializes in the defense of personal and business tax audits. Every day I am on the firing line of the IRS and the taxpayer, helping people just like you prove their returns are accurate and truthful. Sometimes they are not so truthful and I help those people repair the damage they might have done too. Here are some tax audit flags I have… More

100% AUDIT EXAMINATION Low IRS audit rates do not mean that your tax return will avoid IRS scrutiny. The IRS officially audited only 1.67% of all personal tax returns in 1997, the most recent year for which numbers are available. But in reality, on most tax returns 100% of the income and most of the deductions are checked by IRS computers through the IRS’s information return matching program. IRS computers now check the numbers reported for 29 different kinds of income (that includes income from all 1099 forms), and your deductions of state taxes, real estate taxes, and mortgage interest. IRS computers also check your dependency exemptions, both SSA numbers and their matching names. They also check to see whether the dependent was claimed by someone else or filed a return themselves. To the extent that your income and deductions fall into these categories, 100% of them are examined whether… More