• Phillip Bruce Chute EA

How You Get Selected for an IRS Audit and Survive


The government has piles of statistics on everything you can imagine. The IRS also randomly audits groups of innocent people very thoroughly to get samples [Taxpayer Compliance Audits {TCMP} or under other names], and create new audit standard data [norms]. Then, they test the numbered lines on your tax returns to arrive at a numerical score which is compared to the statistical sample norm. This score, which is called the DIF score, is thus compiled. A high DIF generates a human review, which can result in an audit. Items resulting in these high audit scores are missing income, business losses, out of whack cost of sales and other business or itemized deductions, and a hundred other items. normal return is never audited except for a sample stat. Generally, the audits need to be earned. Today the greatest audit probability lies with nonwage payroll 10995 reported, and business losses that offset other income. * Phillip B Chute is an Enrolled Agent, tested, licensed, and appointed by the IRS directly. He has prepared or supervised over 25,000 tax returns over 30 years.


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