Avoid an IRS audit

By Jen Haley, producer


NEW YORK (CNN) -- Worried about an audit this tax season? They're on the rise according to the IRS. But here are some ways you can avoid IRS scrutiny.

First of all, keep in mind that only a little over 1% of individual tax returns are audited according to the IRS. But the number of audits is on the rise. Last year audits increased by 2-1/2%.

While the IRS won't comment on what can trigger an audit, there are some things that may increase the scrutiny of your return, including:

  • deductions that are very large compared to your income
  • rounded numbers or incorrect math
  • any incorrect information at all.

One of the best ways to avoid an audit is to keep precise records. E-filing is a way to cut down on math errors since software programs can do the math for you.

Most audits are initiated through letters or -- sometimes -- a phone call. Make sure you keep all of this correspondence and never ignore a letter from the IRS. Answer the letter before the due date.

The IRS won't go away. If you had taxes prepared by a firm or accountant, sit down and talk to them and have them forward the requested information to the IRS.

If you did them yourself, make sure you provide the necessary information.

If this isn't sufficient, you may be called in for a face-to-face audit. If that happens, consider hiring a professional, like a CPA or a tax attorney to go with you and if you used a paid tax preparer, bring them along to the meeting.

For more information on audits, go to IRS publication 556 at IRS.gov.

If you have an issue with the IRS, there is help available. Check out the IRS Taxpayer Advocate Service. This is an organization within the IRS that helps taxpayers solve problems.

If you face a delay of more than 30 days to resolve a tax-related problem, or you are not receiving a response from the IRS by the date promised, you can get free help from the Advocate Service. The toll free number 1-877-777-4778.

Talkback: Have you been audited by the IRS? To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Overnight Avg Rate Latest Change Last Week
30 yr fixed3.90%3.88%
15 yr fixed3.06%3.03%
5/1 ARM3.05%3.05%
30 yr refi3.96%3.94%
15 yr refi3.11%3.12%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
Index Last Change % Change
Dow 18,232.02 -53.72 -0.29%
Nasdaq 5,089.36 -1.43 -0.03%
S&P 500 2,126.06 -4.76 -0.22%
Treasuries 2.22 0.03 1.37%
Data as of 2:33am ET
Company Price Change % Change
Bank of America Corp... 16.75 0.02 0.12%
Apple Inc 132.54 1.15 0.88%
Hewlett-Packard Co 34.76 0.93 2.75%
AT&T Inc 34.71 -0.36 -1.03%
Microsoft Corp 46.90 0.00 0.00%
Data as of May 22

Sections

Malaysia Airlines is nearly finished with its tough restructuring plan -- which will include cutting about one-third of its workforce -- in its efforts to recover after two plane tragedies last year. More

The True Cost, a new documentary, chronicles the evils of the clothing industry and asks us to stop buying so much cheap stuff More

Google filed a patent for a toy that will have sensors and cameras, and can control connected devices. More

Sarah Kauss launched S'well to rid the world of plastic water bottles. In five years, she's sold 4 million of her stainless steel bottles. More