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Werewolfdad t1_ja10ypv wrote

> How does the IRS know I’m being accurate? Will they audit me?

Usually some level of statistical sampling. The very old computer does math to determine if your return is odd enough to warrant additional information.

Self employed persons are more likely to get audited but the number of audits is still tiny.

If your taxes are accurate, nothing to worry about.

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Werewolfdad t1_ja11kyy wrote

Replying to [deleted] (#2,010,621)

It’s not unexpected for someone your age to have not filed.

If you were reporting $360,000 in income, maybe that’d get more attention. But your earnings is in line with your age

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BouncyEgg t1_ja11s2z wrote

Replying to [deleted] (#2,010,621)

There’s no previous years for you so there’s nothing to compare against.

Being audited isn’t as onerous as it may sound.

You can worry less about being audited the more accurate your records are.

If audited, you just get letters in the mail asking for you to submit the proof that you should already have maintained to substantiate your claims. That’s the vast majority of audits.

There’s no person with a badge who comes knocking on your door and shining flashlights in your eyes. There’s no handcuffs. There’s no chains. There’s no whips.

Just plain old boring paperwork.

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Phoenixrebel11 t1_ja14bf6 wrote

How does the IRS know I’m being accurate: If you received 1099’s for your work, they also received them. They will know if you omit income, unless it’s cash. I don’t recommend not reporting your cash because 1. It’s illegal and 2. You have a growing business and should be proud of your income. If you ever want to purchase a house, car, etc. you need to be able to show proof of income and that’s what your taxes are. As far as expenses use the honor system but keep in mind you need to keep records in case of an audit. Speaking of audits, they are very rare and the IRS is TERRIBLY understaffed. Not even worth thinking about in my opinion. As I mentioned before just keep records and receipts just in case. Since you’re doing your first Sch. C you should probably use a service like TurboTax, they make it dummy proof and they have live agents that you can chat with or call when you have questions. Some people hate TurboTax, I personally think it’s great especially for beginners. Good luck!

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