SEARCH
« Stock Market Futures Up Before Monday's Opening | Main | Nintendo's 3DS Goes on Sale March 27 »
Monday
Mar212011

High Income Earners, Business Owners More Likely to Face Audits

Ryan McVay/Photodisc(NEW YORK) -- Most taxpayers are very unlikely to face an audit.  In fact, just over one percent of them were audited last year.

But high income earners and people with businesses can face a different fate, since they are at a higher risk of being questioned when it comes to their tax returns.

"The simpler your return, the less likely it is that you will be audited," advises Mary Beth Franklin with Kiplinger's Personal Finance magazine.  "The red flags tend to be people who have small businesses or sideline businesses if you file what you call a Schedule C for business expenses."

Failing to report all sources of income could also make an audit more likely.

"The best way to avoid it is making certain that you are reporting all of your income," says tax accountant Janice Hayman.

Should one be audited, it can turn out to be very expensive and time consuming.

Copyright 2011 ABC News Radio

Reader Comments

There are no comments for this journal entry. To create a new comment, use the form below.

PostPost a New Comment

Enter your information below to add a new comment.

My response is on my own website »
Author Email (optional):
Author URL (optional):
Post:
 
Some HTML allowed: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <code> <em> <i> <strike> <strong>






ABC News Radio