Life & Soul
Solutions Directory
Sign up for the weekly tips newsletter

How to Avoid an Audit

How to Avoid an Audit
Alanna Cavanagh
 Print  E-mail
 
Average Rating:  Unrated
Read Reviews of This Solution
Rate & Review This Solution
Want to steer clear of an audit by the Internal Revenue Service and the potentially big penalties that can involve? The IRS recently increased its requirements for record keeping for the following itemized deductions on Schedule A, so it will monitor compliance there more closely, says Ralph Havens of JK Harris & Company, a tax-resolution firm that advises people who owe back taxes or who are being audited by the IRS. (By the way, you have until April 17 to file this year, as April 15 falls on a Sunday and April 16 is Emancipation Day, a federal holiday.) Here are two areas to consider carefully when you’re filling out tax forms, according to Havens:

  • Employee business expenses, such as union dues, and mileage deductions you claim for using your own car on work errands. (Don’t try to claim mileage for your daily commute.)


  • Donations to charity. The IRS wants you to be able to prove the value of a gift. “Even if you give $10 a week to your church, write a check for it,” says Havens. If you donate furniture to the local thrift shop, take a photo, so you can show that the piece was in good shape and help justify a larger deduction. The best way to ward off tax woes? Don’t fudge the numbers, and keep receipts for everything.


  • Tip: Have you made a long-distance phone call in the past three years? Ask your accountant about the long-distance telephone tax refund. Excise taxes should not have been collected, so you may be able to claim a credit of $30 to $60.
    Related Solutions

    Advertisement

    On the Road Sweepstakes

    Enter for a chance to win $5,000 to spend on the ultimate road trip

    Real Simple Weddings

    Our first ever weddings guide for a stress-free celebration