IRS Audit Statistics: Rates and Chances of Receiving a Tax Audit

audit statisticsThe chance of receiving an audit generally changes based on income level and filing type. Below are IRS statistics that are broken down by individual, income level, and business type. These are the overall numbers provided by the IRS, but realize that many factors go into determining if the IRS is going to audit. IRS audits are rarely random and can be avoided by understanding how the IRS audit process works and what the typical red flags are for an IRS audit or examination.


Total Amount of IRS Audits on Individual Tax Returns

FY 2015 FY 2016 FY 2017
FY 2018
Total Returns Filed Prior CY 146,861,217 147,964,324 149,919,416 150,043,227
Total Audits Conducted 1,228,117 1,034,955 933,785 892,817
Percentage Audited 0.84% 0.7% 0.62%  0.59%


IRS Audit Rates by Income Level for Individuals (2018)

Percentage of Total Returns Filed in Calendar Year 2017
Percentage of Returns Audited
No adjusted gross income
1.68%
2.04%
$1 – $24,999
35.59%
0.69%
$25,000-$49,999
23.65%
0.48%
$50,000-$74,999
13.44%
0.54%
$75,000-$99,999
8.66%
0.45%
$100,000-$199,999
12.41%
0.44%
$200,000-$499,999
3.72%
0.53%
$500,000-$999,999
0.58%
1.10%
$1,000,000-$4,999,999
0.25%
2.21%
$5,000,000-$9,999,999
0.02%
4.21%
$10,000,000+
0.01%
6.66%

 

IRS Audit Rates/Statistics by Tax Filing Type FY 2018

Returns Filed (Prior Calendar Year)
Returns Audited
Percentage Audited
Small Corp 1,694,658 9,674
0.6%
Large Corp 74,836 6,050
8.1%
S Corp 4,848,921
10,575
0.2%
Partnership 4,043,349 8,945
0.2%
Individual 150,043,227 892,187
0.59%

Overall the odds that a taxpayer will get audited has decreased over the last few years. In fact, audits hit a 10-year low in FY 2018. Generally speaking, the IRS does audit individuals with higher income because the IRS has limited resources and they get justify going after the higher income individuals. Higher income individuals are also more likely to have things on their tax returns that create IRS red flags than individuals with lower income. Because you file a tax return each year and have about less than a 1% chance each year, it is more likely than not that you will get audited at some point in your life.

Source: IRS Data Book 2018