Lightning and the IRS

 

You may have noticed that it hasn’t rained in weeks. The reservoirs are getting dangerously low. But just as I started this bulletin a thunderstorm went over and dropped a good amount of rain. Now I hope you were safe at home sheltering from both the virus and lightning. If you were squeezing in a round of golf perhaps you were not using metal clubs or one of those big golf umbrellas supporting some candidate you got for free. The reason I ask is that your odds of being hit by lightning in any year is about 1 in 500,000. Now it does depend on where you live in this vast country of ours, but in our dear New Jersey there are more lightning deaths and injuries than almost 40 of the other states. Florida of course is considered the lightning capital of the country. Think about that should you be making retirement plans to the Sunshine State. By the way males are five times more likely than females to be struck by lightning. So says the CDC. The odds of being hit by lightning twice are 1 in 9 million. That is significantly better than the odds of winning the Powerball which I believe are about 1 in 19 million. About now you’re asking where is he going with this. So what about IRS audits? The overall audit rate has been heading downward for years and now the overall exam rate is about 0.4%. That translates into about 1 in 250 returns. Most all of those audits are conducted by mail and are not in depth or “line by line” but rather focus on one or two “sore thumb” issues. To be honest, sole proprietors and high earning taxpayers do have somewhat of a higher audit incident but not significantly so. But for the most part the 249 returns that are never selected by IRS win the IRS audit lottery. That is to say that these folks may be claiming their pet cockatoo as an exemption, reporting a tenth of their income and getting away with all of it. It can explain why some taxpayers have paid no taxes at all for the last 10 or 15 years. No one in Congress seems anxious to step up IRS funding and audit activity. That is easy to understand when some of the biggest offenders are actually running the government. But then again they still have to worry about that damn lightning.