Reduce your chances of a tax audit

Posted January 3, 2009 by Bernz

The end of a new year signals the beginning of tax season. Here are a few tips for keeping auditors away.

211) Don’t leave any answers blank on your tax forms. Use not applicable instead.

2) Include all necessary documentation. Staple documents to forms so there’s no question what goes with what.

3) File online. Online software has step by step instructions and easy to digest information. When you have all this in one place, you reduce your chances for making mistakes.

4) Us a reputable tax preparer. If you choose a tax preparer that has a reputation for dubious claims or gross errors, the preparer could be “flagged” for heightened scrutiny by the IRS which means your tax filing will be highly scrutinized, too.

5) Keep numbers believable. Large deductions, losses, or business expenses that seem hard to believe will arouse suspicion. Large round numbers also raise questions. If your tax filing reports contain large numbers make sure you have supporting documentation.

6) Be honest. Don’t attempt to deduct any disallowed items. You may get away once, but the next time and likely for the rest of your tax filing life the IRS will remember your escape and look for ways to capture you on future filings.

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This entry was posted on Saturday, January 3, 2009 at 8:40 am and is filed under Tax Reduction. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

One Response to “Reduce your chances of a tax audit”

  1. Interesting Reads - January 10th 2009 | OneMint Says:
    January 10th, 2009 at 5:21 pm

    [...] Tips for keeping the auditors away by Invesmint: With the tax season setting in, this post makes a useful read. [...]

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