Assessing My Income Tax Audit Risk

Every year, I wonder if my income tax return will be selected for an audit by the IRS. I investigated what the odds of an IRS audit were. According to the files from the 2010 Data Book (most recent available), the IRS audited about 1.7 million income tax returns, which was only 0.9% of the 187 million filed. It seems filing early versus in April, or refund versus tax owed did not have a bearing on audit risk. Two items clearly increased the risk of audit.

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