In order to help people better understand their risks of audit, additional tax obligation and even incarceration, the personal finance social network WalletHub examined historical IRS data and identified a number of trends related to audit odds and outcomes for consumers and corporations across income brackets.
For both consumers and corporations, the smaller the income, the higher the rate of tax evasion.
Audited consumers who make less than $200K pay 83% higher penalties (as a percentage of adjusted gross income) than people making more than $200K.
Audited corporations that earn $250K - $1M pay more than 11-times higher penalties (as a percentage of adjusted gross income) than corporations earning $10M - $50M.
Individual taxpayers and small businesses have a 1% chance of being audited, compared to 15.80% for large corporations. Individual audit rates have declined in recent years, while corporate audit rates have increased.
Individuals making $10 million or more are 3,933% more likely to be audited than those who make $25,000 - $100,000.
For the full report, please visit: http://wallethub.com/edu/irs-audit-report/3433/
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