TAXES: How To Attract An Audit
Want to attract attention to your tax return? Want the IRS to consider you for an audit? Then go right ahead … and do these things …
Here are the Top 5 tax-return mistakes that could cause you an audit:
1. Leave Out 1099 Income — Be sure to account for all the 1099s you get. A mismatch, even a small one, can trigger a letter from the IRS and maybe further scrutiny.
2. Deduct Your Butterfly Collection — The IRS keeps a sharp lookout* for hobby losses, claimed as business losses on Schedule C. (*The agency just issued a manual to its agents on what to look for!)
3. Claim Big Charitable Gifts — New rules require you have a written statement listing the amount of each contribution; it’s pretty easy for the IRS to start an audit asking for proof — then disallowing your contribution, even if you get the paperwork, for your being late.
4. Use Round Numbers on Schedule A Deductions — To the IRS, $2,979.68 looks a lot more real than $3,000.00. Entries ending in a bunch of zeros are not your friend.
5. Don’t Sign Your Return — A missing signature — a clicked box if electronic, an actual signature if on hard copy — subjects your return to the laws of perjury and is always noticed by the IRS. It’ll get rejected — and might then be considered late!