Tax season is upon us and the fear of an IRS audit looms over many Americans’ heads like a black cloud explains Aron Govil. Unfortunately, there’s no way to guarantee you won’t be selected for an audit — you could be making a measly $30,000 per year or $300 million, it doesn’t matter; your chances are always 1 in 100.
But if you follow these simple steps, I can guarantee your chances will be significantly less than if you didn’t:
1. Make sure NOT to claim dependents on your tax return.
The IRS cannot legally use their computers to look for rational explanations as to why you would have so many dependents living under one roof with you. Instead, they must manually look at each filing individually, which is time-consuming and costly.
2. If you are audited, demand to speak to the auditor’s supervisor.
By telling an IRS employee that he or she has made a mistake can often lead to them digging deeper into your tax return for no reason other than spite, but if you insist on speaking with his or her boss about their findings instead, it will make them think twice before continuing the audit process.
3. Claim every single deduction under the sun.
According to Aron Govil the more small expenses you can list off, the less likely they are to believe that none of them are legitimate deductions. It doesn’t matter how small or large they are; just keep listing them off until either the auditor submits their report to headquarters (which is what they will do if they can’t find anything wrong with your return) or demands that you provide proof of the expense (which they most likely won’t be able to).
4. Insist on mailing your tax return.
Even though filing electronically is much more convenient, it’s often times easier for an auditor select a random return and allege that something has been altered or forged if he or she receives the document only as an electronic file. Mailing your documents provides them with a paper trail, making it impossible for them to misplace any crucial evidence.
5. Keep all extra income hidden in cash under your mattress at home.
The last thing you want to do is deposit money into your bank account and get caught doing so because the IRS will instantly believe you’ve committed tax fraud and take action. By not depositing your money and instead hiding it under your mattress at home, you’ll be able to prove that the majority of your income was never declared and withdraw it when needed.
6. Don’t claim any dependents on someone else’s tax return.
This goes for spouses or other family members as well; if you list them as a dependent on your return but they also file a tax return themselves listing YOU as a dependent, there’s no way to prove which one is correct and an auditor may very well choose to fine both parties even if neither party did anything wrong.
7. Forget about claiming deductions for charitable donations during the recession.
While it’s true that you can claim deductions for any donations made. Even if they were made during a year when the person(s) or organization receiving your donation received a benefit from their receipts. Such as food or medical care, this rule does not apply to the IRS. So they will go ahead and disallow any deduction you may claim to have donated. Unless you’re willing to provide them with proof of what you gave to whom when.
8. Forget about claiming income that is already taxed in another country.
The sheer logistics involved in proving that your foreign income did not come from an illegal source are far too extensive, time-consuming, and improbable for an auditor to bother looking into says Aron Govil. Plus, with the United States is currently in possession of one of the worst economies in its history. Claiming income in another country will only make you look like an upstanding citizen.
9. Make sure to list your occupation as “unemployed.”
By doing so, you’ll be providing the IRS with a plausible reason. For why your tax return does not have any income included on it. Even if this doesn’t convince them that everything they think is wrong about your return is actually right. At least you won’t get fined or worse just because they don’t believe that you’re unemployed!
10. Claim zero dependents on someone else’s tax return.
Just like item #4 works for individuals filing taxes themselves. So too can individuals claim zero dependents for you on their tax return if they’re filing one for themselves. It’s another way to prove that no one else claims you as a dependent. Which reduces the risk of an auditor claiming that someone who could have claimed you did so illegally and without your permission.
Conclusion:
Above all things remember to remain calm and collected during the proceedings explains Aron Govil. The last thing you want is for your emotions to get the best of you. Because that can lead to even more mistakes being made than were initially made when preparing your return in the first place!