Are You Prepared for an IRS Audit?

In the past year, the IRS sharply increased the number of returns it audited, particularly those of high-income earners. According to a government official, this is an effort “to build public confidence in the tax system, encouraging voluntary compliance” and to make sure that both the low end and high end of the income scale are subject to the same rules. This paper reviews recent trends on how the IRS selects individuals for audits and how to be prepared for one.