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Red Flags: Factors That Trigger Tax Audits

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The IRS may run a tax audit to ensure taxpayers follow the law. Although the agency has audited a small percentage of individual taxes, this can still be stressful for ordinary Americans. At our CPA firm in Michigan, MET Certified Public Accountant will guide you throughout the filing process to avoid IRS audits as much as possible.

For years of providing certified public accountant services, we have figured out the ins and outs of the IRS and know what can trigger a tax audit. Here are some:

  • Failure to Report All Your Incomes
    If you change careers in the middle of the tax filing year or do freelance jobs for multiple businesses, make sure to declare all your sources of income in your W-2 or 1099 forms. The IRS can cross-check what you report on your tax forms against what’s reported by employers, banks, or brokers.
  • Unqualified Home Office Deduction
    Now that many are working from home, the home office tax deduction is beneficial for some taxpayers. But the IRS reminds us that not all home-based workers are eligible ? this tax credit prioritizes self-employed individuals. The agency has also placed further guidelines regarding this credit. Better work with a CPA firm in Michigan to verify your eligibility.
  • Incorrect Reports
    The IRS can easily track fundamental errors, such as mathematical miscalculations or wrong Social Security numbers. One tip: avoid rounded amounts like estimating your income by the nearest 100 or 1000. This will seem suspicious on the IRS’ part.

Pay attention to your IRS reports and make sure to know your eligibility for certain tax credits. To help you file your taxes right, our CPAs can help you with tax planning, accounting, home health cost report preparation, and more.

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