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There is no surefire way to avoid being audited by the IRS as most taxpayers are selected for audit in one of two ways:

1. You were selected at random or
2. The IRS computer selected your return as one with a potential misstatement or possible error.

Even though you can't avoid an audit entirely, there are ways you can "audit-proof" your return in order to minimize your chances of being audited and help you survive an audit if you are selected. Audit proofing your return means documenting your deductions so that you can prove you are entitled to the deduction.

For most of your deductions the IRS doesn't require your records to be kept in a specific form (exceptions include travel, entertainment, automobiles, and gifts) or way. You can organize your proof of deduction in whatever way you feel is most understandable. To verify that the expenses you claimed are deductible, you need to show what you paid and proof that you paid it.

You can show proof of payment with:

1. Canceled checks (front and back) - must indicate check number, amount of check, payee and date it was posted to your account

2. Credit card slips - must indicated the amount of the charge, the payee's name and the transaction date

3. Electronic Funds Transfers - must show the amount transferred, the payee's name and the date the transfer was posted to the account

If you're self-employed or you own a business, then you must also prove you had a business purpose for every expense that you deducted. The best way to do this is to keep detailed written records of all your expenses.

Learn more about this author, Gina L Gwozdz CPA.
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