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You can reduce the chances of being audited by avoiding certain "red flags" that can raise suspicions about your tax return, such as:

  • Claiming deductions for charitable donations that are not proportionate to your income.

  • Claiming deductions for travel and entertainment that are not proportionate to your income.

  • Under-reporting income (for example, taxi drivers or restaurant employees not reporting or under-reporting tip income).

  • Claiming itemized deductions of more than 35% of gross income.

  • Deducting home office expenses while working in an office.

  • Claiming bad debts.

  • Paying wages to children or a spouse, splitting income among relatives, or lending money to family members

  • Making errors on personal information (misspelling your name, wrong address, etc.).

You can decrease your chances of being audited by:

  • Being honest about your deductions and income.

  • Keeping meticulous records.

  • Having your tax return prepared by competent professional.

  • Filing your return electronically (which eliminates data entry errors at the IRS).