USA Today (Society for the Advancement of Education): Less Chance Of Being Audited By Irs

Your chances of being audited by the Internal Revenue Service are down, according to Cindy Van Alst, professor of accounting, Ball State University, Muncie, Ind. About 400 IRS auditors are involved in implementing reform laws, leaving the organization short of manpower for auditing millions of tax returns in 1999. The program to reform the IRS should modernize the Federal organization, which is long overdue, she maintains.

"Chances of being audited are less than two percent, but some returns have a higher risk. Returns reporting income greater than $100,000, high deductions, high losses from businesses or investments, home office deductions, and self-employment income increase the chance of being audited."

Van Alst points out that taxpayers already are very good at skirting the rules and that many play Russian roulette knowing so few returns are audited annually. While auditing may decrease, income tax refunds are up 15% over 1998, averaging about $1,729. The main reason may be the new $400 credit for children under 17 and tuition credits.