12/05/2022
How to avoid an audit:
If youāre still worried that youāll fall into the less than 1% of taxpayers who have their returns audited, be sure to avoid common mistakes the IRS computer system is more likely to flag.
āSome mistakes that taxpayers make may seem obvious, but they get overlooked,ā says Borst. Here are some of the most common ones he sees.
-Mathematical errors
-Numbers in your return not matching documents submitted by other payers
-Mismatched tax ID numbers
-Income not matching
-Mis-entering dependentsā Social Security numbers
-Forgetting to sign your return
-Overestimating the value of property donated to charity
-Reporting unusually large deductions (say, for business expenses) compared with previous years
-Claiming losses from a business activity the IRS views as a hobby (āHorse breeding is a classic,ā Borst says.)
-Youād also be wise to figure out the exact amount for any deduction youāre claiming, rather than using round numbers. The IRS uses a mathematical approach to select returns for audit. āIf you say your travel expenses are $400, they say, āThat doesnāt look right.ā If you say $397, that looks more realistic.ā
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