The 12% Outlier Threshold: Small Business IRS Audit Trigger Study & Schedule C Cost Audit (2026)
The 12% Outlier Threshold: Small Business IRS Audit Trigger Study & Schedule C Cost Audit (2026) Executive Summary: Sole proprietorship Schedule C audit rates quadruple when key deduction ratios breach 12% above industry NAICS averages, triggering the IRS Discriminant Index Function (DIF) scoring algorithm. While social media tax influencers claim aggressive write-offs face zero enforcement…