Tax Filing Discrepancies Could Lead to An Audit
In many cases, if someone is told that they will be audited, it can lead to a lot of stress. Not only was the whole process of filing taxes stressful and tedious, but now you have to go through all of the numbers again and be able to prove that they are accurate. If you get a notice of an audit, you might ask yourself “What did I do wrong?” In some cases, an audit is just a matter of chance. In other cases, though, some discrepancy may have triggered some questions from the IRS.
What kind of discrepancies are we talking about? First and foremost, discrepancies when it comes to business expensive can be pretty common. When you are figuring out your expenses, make sure you do not claim any personal expenses as business expenses. Consider your expenses as they relate to your home office if you have one, but don’t go overboard. You need to be able to prove that you actually have a business office and don’t just work from your living room couch.
Next, make sure your numbers are accurate. You may think that rounding your numbers to the nearest hundred is a good idea but it may be the reason you get an audit notice. Try to be as accurate as you can with your numbers. A simple omission of a zero may not seem like a big deal, but when it comes to your taxes, it definitely is.
Finally, consider your charitable donations. If they seem excessive compared to your income, they may bring up red flags.