5 Critical Red Flags to Watch for on Your Tax Return

Saturday, 16 March 2024, 12:30

Learn about the 5 red flags on your tax return that could potentially trigger an IRS audit. By understanding and avoiding these issues, you can reduce the likelihood of being audited and ensure a smooth tax filing process.

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5 Critical Red Flags on Your Tax Return to Avoid IRS Audit

If you stress out thinking about being audited, you don't have to worry. Look out for these red flags and chances are low the IRS will look your way.

1. You failed to report all your income

Fix: Take time to gather all the documents you'll need before filing to avoid discrepancies.

2. Your deductions are out of whack

Fix: Make sure you have the receipts to back up your claim for any deductions.

3. It looks like you got a little creative with business deductions

Fix: Claim any deduction you are eligible for, but keep all receipts.

4. Using round numbers

Fix: Wait for precise amounts instead of estimating with round numbers.

5. You're a millionaire

Impact: 7
Fix: Ensure you have a good team to handle your tax affairs as complexity increases with higher earnings.

This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.