The Internal Revenue Service refers to an audit as an easy examination of your financial records. As a taxpayer to you, it is far more than that. Even in case you don’t have anything to conceal, it brings fear, intimidation and anxiety into your own home and business. You would like to do everything you are able to in order to decrease the likelihood of an IRS audit.
Understand the process used by the IRS to choose tax returns for audit. Typically, the return is selected at random through a succession of checks and comparisons. This doesn’t mean you have done something wrong. Always assume the position you are an honest, cooperative taxpayer.
Our suggestions for avoiding an audit:
- Always include all income you know will be reported to the Internal Revenue Service. This consists of employers, financial institutions, investment agents, etc. The number one variable in nearly all audits is unreported income.
- Double check your return for errors in math. The IRS computer will capture and correct math mistakes, but this brings attention to your return.
- Do not use round numbers in your tax return. The IRS presumes when leaves the item open for question, round numbers are an approximate amount.
- Be sure to answer all questions in the tax return. The IRS will finish the answer, sometimes with effects that are damaging even if a question does not apply to your circumstance.
- Your return will probably be in a bigger volume on April 15 and not as conspicuous. If your filing date is extended by you, most of the earlier returns have been chosen for audit.
- Present an organized, clean tax return. They may take a closer look if the IRS has problem reading or comprehending your instruction manual.
- Uncommon deductions ought to come with an explanation. Clearly describe the circumstances supporting your claim and provide backup documentation.
If you have any more questions about what you should be doing, or ways you can avoid a potential audit, please give us a call today! Our professionals are standing by, ready to help you out right away.