Avoid IRS Audit Triggers

Michael Sheehan

Physician's Money Digest, February29 2004, Volume 11, Issue 4

It's getting to be that time of year.Countless items on your income taxreturn may pique the interest of the IRS,but some increase your chances of beingaudited more than others. The followingare 10 situations to avoid if you hope tosidestep the taxman:

  • Prior audits or deficiencies
  • Excessive business expenses in relationto income
  • Complicated investment transactionswithout written or documentedexplanations
  • Work in a cash-paid profession
  • Large charitable contributions inrelation to income
  • Losses claimed from tax shelters
  • Involvement with a closely held corporationselected for an audit
  • Itemized deductions (schedule A)that exceed IRS targets
  • A sloppy or mathematically erroneousreturn
  • Round (instead of exact) figuresused on the return