For many people, the thought of getting audited by the IRS is enough to make them shake in their boots. No one wants to deal with the IRS breathing down their neck. What many people don’t realize is that the IRS hardly every does a full blown audit these days. With tax returns being filled electronically for the most part, the chance of getting chosen for an audit is pretty small. As small as it may be, there is still a chance it could happen. Mark Dicus & Company is here to talk about some of the red flags that will trigger an audit.
What Causes a Person to Get Audited?
There are a number of different things that could end up flagging your tax return for an audit. Following are some of the most common ones to help you avoid these issues.
– Math Errors: It can be difficult to not make any single math error when you’re submitting your tax return. These errors could lead to an audit and even fines.
– Non-Filers: The IRS is trying to crack down on those that are non-filers. They are especially looking for those that have a high income and are non-filers.
– Underreporting: If you try and skimp on your taxes, don’t plan on getting away with it. The IRS has information about your income that makes it quite easy for them to connect the dots and find income that you need to report.
– High Earners: If you make a large income, there is a greater chance that you’re going to get audited. The IRS is going to monitor your income much closer because so many high income earners try to evade taxes.
– Excessive Losses, Deductions & Credits: You are more likely to get audited if you are claiming a large number of losses, deductions or credits when it comes to your income. They will look at the type of business you run and keep a much closer eye on you when this flag comes up.
– Large Charitable Donations: While you can completely deduct any charitable donations, that doesn’t mean that it isn’t going to catch the attention of the IRS when the donations come in large amounts.
– Self Employed: Make sure you are keeping all of your deductions above board when it comes to your business. Also, if your business is doing well year after year, it is hard to still claim a loss. You will be on the IRS’s radar if this is the case.
Tax Preparation, Filing, Planning & More in Salt Lake City, St. George, West Valley City, Provo, Orem, West Jordan & Greater Cedar City, Utah
If you are worried that you are going to make mistakes with regards to your taxes, you can turn to Mark Dicus & Company to help ensure you are doing it all correctly. We will help you prepare your taxes and make sure that you aren’t overpaying on your taxes, but we will still also ensure you are not making any mistakes that will raise any eyebrows with the IRS. Call us today!