Politics & Government
38 Maryland Cities are Prime Targets for Small Business Tax Audits
New data identifies most likely tax cheats.
If you are a small business owner in one of 38 Maryland cities identified by the National Tax Payer Advocate, you may be at higher risk of an IRS audit.
Using data from 2009 tax returns, the National Tax Payer Advocate focused on sole proprietorships -- which make up approximately two-thirds of all U.S. businesses -- in an attempt to uncover where the most likely tax cheats were located in 350 communities across the country, according to a recent Associated Press report.
About 10 percent of them are in Maryland.
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A 2012 Forbes article discovered a trend that the IRS is “focusing greater resources on small and medium businesses,” which are defined as having between $10 million and $250 million in assets.
The data reviewed by the National Tax Payer Advocate included “scores” which the IRS assigns to each tax return, measuring the “likelihood agents will collect additional tax money from an audit.”
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The 38 Maryland cities identified by the Advocate are: Bowie, Brandywine, Burtonsville, Calverton, Carroll, Clinton, Edgewood, Essex, Fairmount Heights, Forestville, Fort Washington, Garrison, Glenarden, Hillcrest Heights, Hyattstown, LaPlata, Laurel, Loch Hill, Marlow Heights, McDonogh Run, Mitchellville, Montpelier, North Englewood, National Harbor, New Carrollton, Odenton, Raspeburg, Riverdale Park, Rosedale, Russett, Severn, South Bowie, University Park, Upper Marlboro, Walbrook, Waldorf, Windsor Mill and Woodlawn.
On the other end of the spectrum, the study identified the cities most unlikely to cheat on their small business taxes: the Aleutian Islands in Alaska; West Somerville, MA; Portersville, IN; and Mott Haven, a neighborhood in the Bronx, NY.
