Have you ever been audited? That’s when a scary looking IRS agent shows up at your house in the middle of the night wearing a clown mask and taps on all your windows with a broom and . . . wait, no, I think that’s something else.
An audit generally starts with a letter from the IRS: a printed, physical, not-electronic letter than comes in the mail. Chances are that you’re very unlikely to ever get that letter though. Average Americans have a one in two-hundred-and-fifty chance of getting audited.
Audits have hit a low, only about 1 million people were audited in 2016. They’ve been declining for a while, probably due to cutbacks at the IRS.
One interesting thing about audits is that they occur more often the richer you are. As previously mentioned, the average American has a 0.4% chance of being audited but someone making $200k per year has a 0.8% chance. Someone making more than $500k has a 1.6% chance of being audited. People with incomes higher than $10 million have a 20% chance of being audited!
If you ever do get unlucky enough to get that letter from the IRS, or any letter from the IRS, we recommend talking to your tax advisor or accountant as soon as possible. It’s much better to have someone on your side that has experience dealing with the IRS and can help you figure out your best path forward.
Tags: one good joke