How to Reduce the Chance of Being Audited on Your Tax Returns
File electronically., Check your math., Match your data to your tax forms., Back up your charitable deductions., File your return correctly the first time., Be neat and complete.
Step-by-Step Guide
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Step 1: File electronically.
Returns that are submitted electronically are less likely to contain errors, so they trigger fewer audits.
The software that creates the electronic return is essentially free from mathematical errors or copying or transfer errors.
Many of them also import your employer data directly, so you are not even responsible for copying that information., You should use a calculator and confirm that your numbers are added or subtracted correctly throughout the return.
One minor error is not likely to lead to an audit, but overall carelessness could., Carefully record the numbers from your employers’ W-2s or other tax forms.
If you write the numbers down incorrectly, your errors could flag an audit.
You need to realize that the forms you receive from your employers are also submitted independently to the IRS, so the IRS can check and verify your return.Avoid rounding off numbers.
If you report round numbers like $1,000 or $10,000, you are likely to catch the attention of the auditors.
Even if you round up, reporting higher income than actually earned, the round figures are likely to trigger an audit., You are entitled to make charitable deductions, but if you do, you will need to be able to provide evidence of them.
There are certain limitations and rules about the amounts of charitable deductions and the kind of evidence that you need for them.
For more detailed information, read Determine What the IRS Considers a Charitable Contribution or Claim a Church Deduction for Federal Taxes.
Understand that if your deduction amount increases significantly from one year to the next, you may trigger an audit with the computer screening.
If you provide good paperwork to support your deductions, the human screener may release it. , Filing amendments to make corrections will raise attention and increase the chance that you get audited.
Before sending in your tax return, proofread it carefully, make sure that you have attached all necessary worksheets and schedules, and be sure to sign it., If you complete your return by hand, you need to write as neatly as possible.
The tax instruction brochure even gives samples of the block printing that is preferred.
If your return is tagged by the computer for an audit, a human screener will be reviewing it to decide if the audit should take place.
If you make that review easier for the screener, by making your return as neat and readable as possible, then you will reduce the chance of an audit.
You should also fill in every blank on the return, even if you are reporting a 0 for the particular data point.
Even though you believe a 0 might be implied, you should fill in the complete form. -
Step 2: Check your math.
-
Step 3: Match your data to your tax forms.
-
Step 4: Back up your charitable deductions.
-
Step 5: File your return correctly the first time.
-
Step 6: Be neat and complete.
Detailed Guide
Returns that are submitted electronically are less likely to contain errors, so they trigger fewer audits.
The software that creates the electronic return is essentially free from mathematical errors or copying or transfer errors.
Many of them also import your employer data directly, so you are not even responsible for copying that information., You should use a calculator and confirm that your numbers are added or subtracted correctly throughout the return.
One minor error is not likely to lead to an audit, but overall carelessness could., Carefully record the numbers from your employers’ W-2s or other tax forms.
If you write the numbers down incorrectly, your errors could flag an audit.
You need to realize that the forms you receive from your employers are also submitted independently to the IRS, so the IRS can check and verify your return.Avoid rounding off numbers.
If you report round numbers like $1,000 or $10,000, you are likely to catch the attention of the auditors.
Even if you round up, reporting higher income than actually earned, the round figures are likely to trigger an audit., You are entitled to make charitable deductions, but if you do, you will need to be able to provide evidence of them.
There are certain limitations and rules about the amounts of charitable deductions and the kind of evidence that you need for them.
For more detailed information, read Determine What the IRS Considers a Charitable Contribution or Claim a Church Deduction for Federal Taxes.
Understand that if your deduction amount increases significantly from one year to the next, you may trigger an audit with the computer screening.
If you provide good paperwork to support your deductions, the human screener may release it. , Filing amendments to make corrections will raise attention and increase the chance that you get audited.
Before sending in your tax return, proofread it carefully, make sure that you have attached all necessary worksheets and schedules, and be sure to sign it., If you complete your return by hand, you need to write as neatly as possible.
The tax instruction brochure even gives samples of the block printing that is preferred.
If your return is tagged by the computer for an audit, a human screener will be reviewing it to decide if the audit should take place.
If you make that review easier for the screener, by making your return as neat and readable as possible, then you will reduce the chance of an audit.
You should also fill in every blank on the return, even if you are reporting a 0 for the particular data point.
Even though you believe a 0 might be implied, you should fill in the complete form.
About the Author
Nicholas Thompson
Specializes in breaking down complex home improvement topics into simple steps.
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