1 of 5

Write now Article Tools

In the United States, filing taxes appropriately, on time, and filling in the blanks accurately and with the best of intentions is the only sure way of avoiding anxiety over potential audits. If yours is a successful company that makes lots of money, you will be watched closely, so expect it. To guard against an audit, be vigilant and show the IRS that you know how to conduct an honest business and you are answering their questions to the best of your ability.

You will employ an accountant you can count on and you will be meticulous in saving your receipts to show what you have given in charitable contributions; and you will try to be as truthful as possible while not shortchanging the government or your business, yourself, or your family. You will list as many legitimate deductibles as you qualify for, but you will not dream up any that are only on the fringes of reality.

Yet, even with the best intentions many innocent taxpayers are caught in the IRS auditing net. This may be you. For some reason your filings have set off an alarm that tells the revenue people you need to do a little explaining. That is annoying to say the least. In your case since you are not guilty of wrong doing the audit is nothing more than governmental nit-picking.

Audits cause much fidgeting and worrisome sleepless nights while you as a tagged taxpayers wonder what went wrong. Yet, all this is necessary since not every tax payer is as blameless as you are. Blameless in intent but according to the list they go by, you must prove your innocence. What caused them to snag you?

Home office Deduction:

This is a convenience that is growing in popularity and while it is a legitimate deduction it has its rules: a. you must work there most of the time; b. you must use this area for business callers; c. it must be a separate place and used for no other purpose. To learn more about this deduction read IRS Publication 587.

Unexpected changes as to how you file:

The IRS likes consistencies. If you have suddenly switched things around from the previous year or you have added new deductions or have made a big jump in income, you may be questioned. If you made a lot more money last year than this year, they will also want to know why.

State and Federal income taxes don't match:

This does not make sense to the IRS. Why can't you get your numerical story straight? They probably figure you have had a change of opinion since you pay your state tax every three months and your income tax once a year. They can't read

• 1
• 2
• next page >>

Add your voice

Know something about Red flags on your business tax return that may trigger an IRS audit?
We want to hear your view. Write now!