How late can you deposit a check and count it as last years income?

[MarkS]

And the chances of anyone with an income of $15K getting audited are the same as higher incomes?

The IRS doesn't publish these statistics obviously, but it seems that realistically they spend their time going after the bigger fish.

Think of them as a business, trying to maximize their earnings. If they assign someone to spend 2 weeks auditing you, and he earns $2,000 for those 2 weeks, and gets $500 more in taxes out of you, they lost more than they gained.

If however they go after a millionaire and get $50,000 more in taxes out of him, they gain a lot!

[AsherO]

The IRS doesn't publish these statistics obviously, but it seems that realistically they spend their time going after the bigger fish.

Think of them as a business, trying to maximize their earnings. If they assign someone to spend 2 weeks auditing you, and he earns $2,000 for those 2 weeks, and gets $500 more in taxes out of you, they lost more than they gained.

If however they go after a millionaire and get $50,000 more in taxes out of him, they gain a lot!

That's true, but they also audit some people (might be less proportionally) at the lower income levels so that people who earn less should also fear an audit.

[MenachemMendel]

The IRS doesn't publish these statistics obviously, but it seems that realistically they spend their time going after the bigger fish.

Think of them as a business, trying to maximize their earnings. If they assign someone to spend 2 weeks auditing you, and he earns $2,000 for those 2 weeks, and gets $500 more in taxes out of you, they lost more than they gained.

If however they go after a millionaire and get $50,000 more in taxes out of him, they gain a lot!

Thought so, although you never know with the government, they might spend $1000's just to get people to do what's right, no matter what amount of $ (you know how nasty government workers could be...)
In other words, if an IRS guy is going to suspect something when processing a $15K 1099 and put it in the "audit pile", he can cause problems as much as when the taxes in question are in the big numbers.

I guess the question boils down to: What are the chances that some dude sitting in Albany will decide to audit a plain Jane 1099 of about $15k?

[AsherO]

Thought so, although you never know with the government, they might spend $1000's just to get people to do what's right, no matter what amount of $ (you know how nasty government workers could be...)
In other words, if an IRS guy is going to suspect something when processing a $15K 1099 and put it in the "audit pile", he can cause problems as much as when the taxes in question are in the big numbers.

I guess the question boils down to: What are the chances that some dude sitting in Albany will decide to audit a plain Jane 1099 of about $15k?

1st of all, methinks you mean 1040 (as in a tax return, that's what the IRS audits), no?
A simple e-filed 1040 with a W2 and/or a few 1099s showing ~$15k income probably gets processed  automatically by computer (without any human intervention). Someone please CMIIW.

[MarkS]

1st of all, methinks you mean 1040 (as in a tax return, that's what the IRS audits), no?
A simple e-filed 1040 with a W2 and/or a few 1099s showing ~$15k income probably gets processed  automatically by computer (without any human intervention). Someone please CMIIW.

You are correct, however it has been said that filing your 1040 with a 1099 attached does somewhat increase your risk due the abuse that many perpetrate by getting a 1099 instead of a W-2.

[MenachemMendel]

A simple e-filed 1040

I file it by regular mail. That changes everything, no?

[MarkS]

Some   of           these    articles    may

help you out. I found them all on google!

[MenachemMendel]

I get the drift...

An audit means someone knocking on the door surprisingly, or a letter letting the person know that someone will be knocking on their door?

[MarkS]

I get the drift...

An audit means someone knocking on the door surprisingly, or a letter letting the person know that someone will be knocking on their door?

Initially a letter asking for more information. If through mail correspondence you satisfy them there will be no knock on your door.

[AJK]

That's true, but they also audit some people (might be less proportionally) at the lower income levels so that people who earn less should also fear an audit.

I'd bet this is the case as well.

[Dan]

I've had IRS mail correspondence before.  A company 1099'ed a higher amount then they should have and then I had them correct it but apparently they never gave the IRS the correct version.

Had them resend the corrected 1099 and that was the end of it.

[AsherO]

I've had IRS mail correspondence before.  A company 1099'ed a higher amount then they should have and then I had them correct it but apparently they never gave the IRS the correct version.

Had them resend the corrected 1099 and that was the end of it.

Yup. It probably raises a flag if the IRS gets two different versions (amounts) of the same 1099, one from the payer and another from the recipient.

[AJK]

Yup. It probably raises a flag if the IRS gets two different versions (amounts) of the same 1099, one from the payer and another from the recipient.

Not only is it probable, from my understanding that's one of the surest red flags.

[BAHayman]

Not only is it probable, from my understanding that's one of the surest red flags.

Brings me back to my question that I asked earlier:

So then the 1099 that one receives and is filed with the IRS would report a different amount than the amount that one would put on a 1040, correct?

[MarkS]

Brings me back to my question that I asked earlier:

The amount on the 1099 would be carried over to a schedule C, and if there are no deductions there would appear on your 1040 as well.

[whYME]

I file it by regular mail. That changes everything, no?

FWIW, My accountant claims that in her experience e-filing carries a higher risk of being audited.

Yup. It probably raises a flag if the IRS gets two different versions (amounts) of the same 1099, one from the payer and another from the recipient.

who knows. I once mistakenly left out one of my 1099's and I got a bill from the IRS for that money. It didnt seem to trigger anything more...