Tax day has come and gone and this year’s its being followed with a little relief.
Budget cuts and new responsibilities have the IRS busting at the seams and that’s good news for tax payers. Because the agency is stretched so thin it has fewer agents available to audit people. The IRS commissioner says they will keep going after the worst of the bad guys. But he says there are some people that they should catch that they probably won’t be able to.
So how do you know if you’re in the clear? If you report making $40,000 in wages and your employer reports 50; the IRS will catch that. But if you operate a business that deals in cash your chances of getting caught are the lowest they’ve been in years.
The IRS says one of the biggest red flags is when your deductions don’t match your income. If you deduct $70,000 but only report $100,000 the IRS will question you’re ability to live. Looks like those cutbacks are cutting you a little slack.