Question: Income tax returns are selected through a computer analysis called the Discriminant Function or DIF system, which is designed to identify returns with a high
Income tax returns are selected through a computer analysis called the Discriminant Function or DIF system, which is designed to identify returns with a high probability of error and a resulting significant tax change. For example, returns with enormous deductions that would appear beyond the taxpayers financial ability because claimed deductible expenses nearly equal reported income will result in a high DIF score.
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