Tax audits can be stressful, but they are often preventable. Many audits result from simple errors or overlooked details that trigger IRS scrutiny. Here are some common tax audit mistakes and how to avoid them:

Failing to Report All Income


All income, including freelance work, side gigs, and investment earnings, must be reported. The IRS receives copies of 1099s and W-2s, so failing
to report them can raise red flags.

Overstating Deductions


While deductions help reduce taxable income, exaggerating expenses or claiming non-qualifying deductions can trigger an audit. Ensure all
deductions are legitimate and supported by receipts.

Mixing Personal and Business Expenses


If you’re self-employed, it’s crucial to keep personal and business expenses separate. Using a dedicated business account and properly
categorizing expenses can help prevent IRS suspicion.

Home Office Deduction Errors


The home office deduction is valuable, but it must be used correctly. The space must be exclusively used for business, and calculations should be
accurate to avoid discrepancies.

Large Charitable Donations Without Documentation


If you claim significant charitable contributions, ensure you have proper documentation, including receipts and acknowledgment letters from the
organizations.

Math Errors and Incorrect Information


Simple mistakes like miscalculations or typos in Social Security numbers, income figures, or deductions can result in an audit. Double-check
numbers and use tax software or a professional preparer to minimize errors.

Excessive Business Meal and Travel Deductions


While business meals and travel are deductible, claiming excessively high amounts or expenses unrelated to business can raise red flags.
Maintain logs and receipts for verification.

Claiming Dependents Incorrectly

Ensure dependents meet IRS requirements and are not claimed on multiple tax returns (such as divorced parents claiming the same child).

Failing to File or Filing Late
Late or missing tax filings increase the likelihood of IRS scrutiny. File on time, even if you can’t pay immediately—payment plans are available to
avoid penalties.

Not Hiring a Tax Professional


Working with a tax professional can help prevent errors, maximize deductions, and ensure compliance with tax laws, reducing the risk of an audit.

Final Thoughts


Avoiding these common tax audit mistakes can help you stay compliant and reduce stress during tax season. Keeping accurate records, being
honest with deductions, and consulting a tax professional can significantly lower your audit risk.
Need help ensuring your taxes are accurate and audit-proof? Contact us today!