| Just hearing the word audit is enough to send most | | | | trigger but it is one, especially if you are a sole |
| people running for IRS Tax Audit Help and send a | | | | proprietor and file Schedule C. This is partially true |
| shiver up their spine. Wouldn't it be great if to learn | | | | because the IRS has surmised that those that are self |
| how to avoid a IRS tax audit? Well there are certain | | | | employed have more opportunity to hide income. It |
| things you can look out for that will trigger an audit. | | | | also allows the taxpayer opportunity to convert |
| Here are a few: | | | | personal expenses into business expenses. The home |
| Claim Tax Deductions You Are Entitled To: | | | | office deduction is tricky so you might want to consult |
| Take the legitimate credits and deductions that you | | | | with a CPA or other tax professional to determine |
| are entitled to. If there are questionable items on your | | | | your eligibility before claiming the deduction. |
| tax return that could raise a red flag you might want to | | | | 4) Many taxpayers receive all or a large portion of |
| send with the return an explanation and/or | | | | their income in cash. Waiters, taxi drivers, hairdressers |
| documentation to back up the claims legitimacy. If it is | | | | etc... are prime targets for an IRS audit. That's in part |
| reviewed by a real person because the return has | | | | because they receive much of their income in the |
| been flagged these will help, and prevent the need for | | | | form of cash tips. The best advice you will ever be |
| IRS tax audit help. | | | | given is to keep accurate records. A IRS publication |
| The Discriminate Index Function: | | | | 1244, Employee's Daily Record of Tips and Report to |
| The IRS uses a computer program to flag tax returns. | | | | Employer should be used to track daily tips. |
| This program is named the "Discriminate Index | | | | 5) In case you're divorced, only one parent, usually the |
| Function" (DIF). DIF compares a taxpayer's deductions | | | | custodial parent can claim a child as a dependent. A |
| with others in the same income bracket. The program | | | | tax waiver is required if that is not the case, signed by |
| gives every return a computer generated score that | | | | the custodial parent in order to take the deduction. Be |
| indicates the probability that questionable items exist on | | | | aware the IRS matches tax deductions for alimony |
| the return. The more your return deviates from what is | | | | payments by one former spouse with the taxable |
| considered NORMAL, the higher your score will be and | | | | income reported by the other. |
| of course the more likely you will be audited. | | | | 6) Offshore accounts are rarely used by people |
| Some Common IRS Tax Audit triggers are: | | | | whose wages are reported to the IRS by employers. |
| 1) PLEASE for your sake, report all your income, this | | | | The money generated in offshore accounts is legal so |
| can help avoid an IRS tax audit. The IRS has | | | | long as it is reported and taxes are paid. The failure to |
| computers that will compare income you reported | | | | declare this income and to pay the tax on the income |
| when you filed your return to information it receives | | | | is a felony punishable by up to five years in prison. |
| from employers and from 1099 forms that were | | | | 7) If your return is signed by a tax preparer that is on |
| issued by banks and brokerage firms to you. Compare | | | | the IRS's list of "problem preparers"(preparers that |
| the income you plan to report on your 1040 to your | | | | have violated the law repeatedly), this increases the |
| W2 forms and all 1099 forms, before you file. | | | | probability of audit selection. Too bad this list is not |
| 2) Itemized deductions you have claimed that are | | | | available to taxpayers. Wisely choose your tax |
| unusually high based on your income can trigger an | | | | preparer. |
| audit. For example, lets say you make $29,000 and | | | | Any scheme, scam, questionable filing and even |
| you show charitable contributions of $10,000. This | | | | honest mistakes can raise a red flag and lead to an |
| would not be reasonable for the income you have | | | | audit. Professional tax preparation help show you how |
| reported and, it is very likely the IRS will look closer at | | | | to avoid an audit. However, should you be audited don't |
| your return. | | | | hesitate to seek professional IRS tax audit help. |
| 3) You wouldn't think that being in business would be a | | | | |