Clients always seem to have a big fear of being audited. This is valid concern, but you are much more likely to get an IRS notice. Last year alone the IRS issues 201 million notices to taxpayers. Considering there were only 155 million taxpayers, this is an astonishing number. Only 1.4 million of these notices were audit notices while around 50 million were for account discrepancies and return adjustments.
Over the years, the IRS has relied less on field agent audits and more on issuing tax notices. Ten years ago the IRS only issued around 30 million notices. This is a 670% increase. As the reach of the IRS expands, we anticipate this tread not only to continue but to increase.
So, the next time you open your mailbox, don’t be surprised to see an IRS notice. Welcome to the new IRS. Business as usual.
If you have any questions about a notice you receive or how to response, please do not hesitate to contact us.