Audits Up

Michael Sheehan

Physician's Money Digest, June15 2004, Volume 11, Issue 11

The result:

You've filed form 1040, but you'renot home free yet. The IRS has 3 yearsfrom the date you filed (longer if they suspecttax fraud) to call you in for anaudit. In an effort to get more bang for itsenforcement buck, the IRS is zeroing inon upscale earners, corporations, and offshoretax evaders for audits. Although the total number of audits wentup 14% last year, the number of audits ofhigh-income taxpayers rose even more.In 2003, the IRS performed 24% moreaudits than it did in the previous year onthose who earned $100,000 or more, acategory that includes about 85% ofpracticing doctors. It's working—collectionslast year were up 9% to $35.5 billion,the highest level in 10 years.