Tyrone claimed a large amount of charitable contributions as a tax deduction relative to taxpayers with similar levels of income.If Tyrone's tax return is chosen for audit because of his large charitable contributions,which audit program likely identified Tyrone's tax return for audit?

Question

Quizplus · Accepted Answer

The Discriminant Function System (DIF) is an audit selection tool used by the IRS to identify tax returns with a high likelihood of containing significant underreported tax liabilities. One of the factors considered in the DIF System is the taxpayer's deductions relative to their level of income. In Tyrone's case, his large charitable contributions, when compared to taxpayers with similar levels of income, may have triggered the DIF System to identify his tax return for audit.

Tyrone Claimed a Large Amount of Charitable Contributions as a Tax