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Tax auditors’ sixth sense helps them nab tax evaders

July 1, 2013

Poster of Alexander the seer; click image for more ESP studies

Anyone who has gone head-to-head with an auditor has probably felt like the examiner was staring straight into their tax-paying soul.

They were right.

A German scientist says that tax investigators have a sixth sense that makes it easier for them to sniff out tax evasion.


And that disconcerting finding makes six this week's By the Numbers figure.

"It is already known in psychology that, for example, drug squad officers
use unconscious learning processes to collect experience-based knowledge
of how to identify suspects who then turn out, after checks, to be drug
smugglers," said Enrico Schöbel of the Institute for Public Finance
and Management at Leipzig University.

"A similar
experience-based process takes place with finance administrators dealing
with individual cases," according to Schöbel and reported by The Local.

Schöbel's findings, recently published in the German language journal Perspectives of Economic Policies,
note that while tax inspectors generally cannot explain what makes a
typical tax evader, they unconsciously use their experience, which we typically call instinct, to determine whether there might be something suspect.

Yep, auditors can say, "I see tax cheats."

Stop groaning. You were thinking it.

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TAX-SAVVY WAYS 
TO WRAP UP 2026

It’s over! With October’s extended filing deadline behind us, it is now time to focus on year-end moves to reduce your 2026 tax bill. 

You’ll find ways to do just that on the Tax Tips page (see the More Tax Posts drop-down menu at the top of the blog), as well as the separate tax tip pages for each month, notably October through December. If you’re on the Tax Tips page, you’ll find a monthly list at the end of this column. If you’re on another blog page, you can head straight to the October tips; at the bottom of that tips page you’ll find links to all the other 11 months’ collections of tax advice.

Not to spoil what you’ll find in that tax advice, but it does cover such things as tax deductions for charitable donations, investment moves that could reduce tax due, and ways to max out your tax-favored retirement savings. 

Finally, as the year winds down, things get hectic. There are lots of other things to occupy our time, like the much more fun upcoming holidays. But don’t lose sight of taxes, since timing is key. To be of use, most tax moves must be made by the end of the tax year. That’s Thursday, Dec. 31, which also is the last business day of the year. 

So that you don’t miss that final tax year deadline, also keep an eye on the countdown clock below. It will keep you on top of just how much time is left to make important, tax-saving moves. (Note: I’m in the Central Time Zone, so adjust accordingly for where you live.)

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