Mistakes Can Flag You for an Audit!
Author: Keith Huggett
A lot goes into tax preparation, especially if you have a small business. Many large issues, like mixing personal and business deductions or making mistakes with payroll taxes, can be significant red flags that increase your risk of an IRS audit. On the other hand, there are a number of small errors that you can make that can cause just as much trouble. Here are a few common errors you should be on the lookout for:
- Matching numbers: The IRS frequently checks your return against informational returns like 1099, 1098 and W-2 forms. If they don't match, it becomes a red flag.
- Correct filing status: If you claim the "Married Filing Jointly" status but are single, you can probably expect a call or letter from the IRS.
- Accurate name and Social Security number: Your return can be refused if your name does not match the name on your Social Security card. Entering an incorrect Social Security number or filing a return without one could also lead to a rejection.
- Correct calculations: If you make a math error anywhere on your return, it could have a significant impact on your bottom line. Even if you don't catch it, the IRS probably will.
- Complete packages: When you file your return, remember to enclose every attachment and to collate the forms together in the correct order as determined by the "attachment sequence" number printed on each form's front face.
