An IRS audit is something that most people dread being at the center of and in short you could find yourself being audited by the IRS even if you are someone who always files their returns on time and makes their payments to the IRS on time. Of course, an audit doesn’t mean that you will be in trouble or owe more money. However, nobody really wants the hassle of being audited by the IRS so it is important to remember that there are certain red flags that can trigger this procedure. By making yourself aware of these you can help to reduce the chances of being audited.
- Mistakes: If you make silly and avoidable mistakes on your tax return you could find that this triggers an audit. This is why you should always check your return and ensure that all the data and figures on there are accurate.
- Dishonest information: You stand more of a chance of getting noticed and audited if you attempt to lie or provide inaccurate information on your tax return, which is something that is a particular issue for higher income earners. Make sure that you are honest in the information you provide and that way you won’t have to worry even if you are audited.
- Unrealistic deductions: Another red flag that could trigger an IRS audit is a return with seemingly unrealistic deductions on it. With this in mind, make sure you are honest and accurate when it comes to your deductions rather than trying to add everything you can on to your return.
- Method of filing: You can reduce the chances of an audit trigger simply by filing your return online, as the IRS states that there are less likely to be mistakes with returns that are filed using this method.
All of these can be key triggers that could boost the chances of you being audited by the IRS.