I think our members would be interested in knowing that "What is the overall IRS Audit Rate for Individual Tax Returns in 2010?"

For the tax year 2010, the IRS has released statistical information that approximately "1.11% of all taxpayers will face an examination of their individual income tax return's". This represents the highest rate on record and taxpayers on extensions need to be aware of this fact whilst filing their 2010 tax returns after April 2011.

I agree with your conclusion that taxpayers who have filed an extension should not be aggressive with their deductions, and all deductions should be supported with proper documentations.

The IRS would assess substantial penalties during an audit if taxpayers cannot provide support for deductions claimed on the tax returns.

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