Yes and no. Great accountant answer, huh? The truth is that the Internal Revenue Service has some special red flags in place that help flag your tax return for an audit. Those super-secret red flags are revealed to no one. Apparently the IRS system takes your tax return data, runs its super-secret algorithm, and decides if your tax return is a high risk for problems.

So the usual way you get flagged for an audit is due to what you’ve reported on the face of your tax return. Home office deductions have long been dogged as items that increase your chances for an audit, and I tend to believe that’s true. Why would a home office be a red flag? It’s a much-abused deduction, and it can be closely tied to other questionable deductions like those from a multi-level marketing “business.”

For a long time, the IRS also selected some taxpayers for audits completely at random. That program was suspended when the IRS decided to focus instead on those tax returns that had more red flags. But the random audits are back!

Why? Our tax system in America is based upon voluntary reporting and compliance. That means that the government trusts us to honestly report our income and expenses. Some items like are verified by third parties with things like W-2s and 1099s. Many items are reported on the honor system.

So the IRS hopes that we report honestly, and uses some scare tactics to keep people on the straight and narrow. Large fines and penalties, as well as prison sentences for those who cheat on their taxes are supposed to deter others from cheating on their own taxes. Surprise, random audits are meant to do the same thing. The fear that you might be randomly selected is enough to keep many honest when filing their income taxes. Last year, a total of about 1.3 million taxpayers were audited by the IRS.

This year, the IRS will select about 13,000 individual taxpayers for random audits. In addition to checking their tax returns for accuracy, the IRS is also using the audits to gather information about compliance with the tax laws.