Taking the worry out of getting audited
Often times business owners dread opening the mail around tax season. Getting a letter from the IRS is not the funnest thing in the world but how often will that occur? I looked it up and found some interesting statistics.
Only about 1.1% of 142,823,105 individual income tax returns were audited in 2010, up slightly from a year ago. Does high income mean you stick out from the pile? Not necessarily. In fact, a whopping 30% of returns audited claimed the earned income tax credit (EITC).
But rising income generally means rising risk. If you had non-business income of $200,000 to $1 million, you had a 2.5% chance of audit, increasing to 2.9% if your return showed business activity. But if your income tops $1 million, the audit rate was 8.4%, way up from 6.4% in 2009.
We put together this Slideshare to offer more helpful tips to get past the audit and actually be prepared for it before it even begins.
Don't let the worry of getting audited get you down! Take a step by step approach and be prepared. LUXA Enterprises is an outsource accounting group offering accounting solutions to improve bookkeeping tips in small and mid-size businesses in the Tulsa and surrounding areas.