Internal Revenue Service scores returns for audits

In order to determine if your tax return should be audited, the IRS uses a scoring system to identify which tax returns may generate more tax revenue if they were audited. The DIF (Discriminant Inventory Function) is a score assigned to returns based on certain criteria that the IRS has determined increase the possibility that the taxpayer “cheated” on their income tax returns. A study by the National Taxpayer Advocate has revealed several geographical areas where it is more likely that taxpayers will cheat on their tax returns. The IRS uses this information to target returns for audits.

For more read, “Tax Cheats In Wealthy Suburbs Targeted By IRS.

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