The audit rate for individuals held steady in 2011 at 1.11%. That is one out of every 90 returns. The number of exams actually fell slightly.
The audit rate remained the same because the number of returns filed also dropped (non-filers? Is there any follow-up?).
Taxpayers with incomes of $1 million continue to get more audit scrutiny, surprise. The Service treated them to more scrutiny; they audited 12.48% of these filers. That is one out of every eight tax returns.
Filers with incomes of at least $200,000 but under $1 million were targeted as well. Almost 4% of their returns were audited in person or by mail; one out of 25 returns.
For those with incomes under $200,000, they were favored if by the IRS if you call it that since there was a slight drop-off in exams. In 2011, 1.02% of their returns were examined, down from 1.04% 2010.
Business returns also had their own fun with the IRS; they had an audit increase across the board last year. The audit rate rose to 0.63%, or one out of every 159 returns, up from 0.58% in 2010.
S companies, partnerships and regular corporations all saw a boost in examinations. Remember the IRS is not fond of small businesses. They are time consuming to audit, hard to verify unrecorded revenue and personal expenses run through the company and little upside in tax revenue.