Smart Solutions For Federal Tax Issues
David Coffin office building

Important steps to avoiding an IRS audit

Knowing the best strategies for doing a safe tax return is an important way for people to avoid being audited by the IRS.

Everyone in Texas needs to file their taxes when the time comes around, and the question that sits at the back of each person’s mind is whether or not he or she will be audited this year. The fact is that while some people are more or less likely to be audited, there is a small percentage of audits each year which are performed on random tax returns. So the real thing people should keep in mind as they file their taxes is whether or not they would pass an audit. There are some things anyone can do to make sure their tax returns are in the green zone.

General good tax practices

One thing that anybody can start doing today is to start keeping organized, complete records of all expenses that will be reported. For instance, keeping records of mileage for vehicles used for work can help to provide more accurate reporting on gas expenses. Documentation backs up any kind of deduction, including for charitable donations over $500. In general, a good rule to stay clear of suspicion is to avoid being an outlier if possible.

Proper reporting on tax returns

The first thing everyone should do before filing their returns is to check over them to make sure there are no mistakes. Beyond this, the following list contains some additional guidance on making an audit-safe income tax return:

· It is important not to make up numbers on a tax return. Proper recordkeeping, as noted above, can help make sure that all deductions are stated accurately.

· People should not claim deductions unless they are certain they qualify for them. Forbes states that nearly 40 percent of returns were audited on the basis of claiming an Earned Income Tax Credit claim.

· Parents with young adult offspring should confirm with one another whether or not the child will be claimed as an independent.

· Any number that is typed in should be double-checked, particularly social security numbers, which often have to e transposed if not known by heart.

While it can be helpful to use tax software or to hire a professional to review returns, some people want to do everything by themselves. Anyone doing this ought to double check their math so as to make sure all the totals are correctly reported.

If someone in Texas is dealing with an audit from the IRS because of his or her taxes, it can be difficult to figure out the best plan of action. Even a small mistake can lead to a major investigation. An attorney in the area who practices tax law may be able to provide sound representation and peace of mind.