Being Audited

[suehelen]

I have a friend who is a daycare provider also. She went to H & R Block and the person who is going to do her taxes told her that those who file with a schedule C will face an audit automatically. Tom, are we going to be automatically audited?

Thanks!

[sharlan]

I've had HR Block do my taxes for the past 18 years. I've never been audited due to my daycare. We were audited for 2010, but it had nothing to do with my daycare. They made a mistake on some stocks we have, refiled, and the IRS is still disagreeing with them. HR has paid the extra fees and penalties.

[suehelen]

That's awesome. However, this person told her that if you file a schedule C with your taxes (any small business) you WILL be audited for sure. I told her I didn't think this was true.

[Angelsj]

That is statistically unlikely. There are millions of small businesses in the US. The chances of even having the manpower to audit ALL of them is improbable, if not actually impossible.

[TomCopeland]

Audits

I have a friend who is a daycare provider also. She went to H & R Block and the person who is going to do her taxes told her that those who file with a schedule C will face an audit automatically. Tom, are we going to be automatically audited?

Thanks!

Absolutely not! The person might have meant that those who do file Schedule C are more likely to be audited than those who are incorporated. Although this is true, it doesn't mean you need to worry about being audited. If you are, contact me and I can provide free help.

Check out my upcoming webinar February 12th: "Tax Changes for 2012: How to Avoid Mistakes on Your Tax Return" To register: http://events.r20.constantcontact.co...&llr=yatrx4cab

[KEG123]

Definitely not true. If that was true, I would have been audited last year, but I was not.

[suehelen]

He said specifically that it was this year. If it were true for previous years, I would have been audited since 1991.

Thanks, Tom. I knew you would relieve my concerns. I think he was trying to scare her for whatever reason. He specifically said that if you file a tax return with a schedule C THIS YEAR, you will automatically be audited. I told her this person was full of it, but I had to check just to make sure! LOL