Ive done my taxes with the same guy for the last 10 years but this past year, I had to go to someone else because he was arrested for tax fraud(or something like that)...I bring this up because today, I read that several Tax services across America were being shut down and there were arrests...I was talking with some co-workers and the subject came up...One of em said that the government is going hard after these Tax Services due to the economy...Makes sense to me because folks cheat on their taxes all the time but now Uncle Sam is frantically looking to audit anyone, at anytime....So all you people that write off chewing gum as a tax -write off or go to these "bootleg" tax services better watch out!!!!! Have any of you noticed that during these hard times, the economy so ****ed up that Uncle Sam comes after you from all angles???
I do recall reading that the IRS said they were stepping up its audits for people who are self-employed, as they are the biggest group to cheat on their taxes.
I do think the national debt plays a factor. To raise money, Washington is determined to cut down on tax fraud. Over the last few years there have been increases in the penalties for paid preparers. All paid preparers that prepare tax returns must register with the IRS and get a PTIN. Some preparers flat out cheat, others allow clients to cheat by ignoring that what the client presents is obviously untrue. In going after preparers, it is catching multiple people in one swoop. Still an audit in person is still very uncommon.
I think so too. But what my co-worker was saying was when they audit a tax service that has been charged of tax fraud, they will probably look at those coustomers in a certain tax bracket to come after next... So the lower class (because thats probably who are repeat customers of these crooked tax services) will be audited ...Which is kinda ****ed up when you think about it!!!
I seem to recall (though my info would be old) that budget cuts in the IRS degraded their auditing workforce, so they were doing fewer audits, catching fewer cheaters, and losing more tax money owed to them. Ok, I got off my lazy butt and found a link: http://www.freakonomics.com/2011/03/08/irs-math-600-million-4-billion/
They are doing more more correspondence audits and fewer in person audits. I've been working in public accounting for 7 years, and not once have I had one of my clients subject to a human audit. I did have the IRS drop in on a client, but after a phone conversation with the agent, they left and the case was closed, and that was related to payroll, not income tax.
