(RightWing.org) – Many Americans continue gathering their financial documents as the April 18th tax filing deadline lurks around the corner. Media outlets focusing on financial news recently reported that the IRS is flagging taxpayers with specific filing characteristics in common.
On Monday, April 4, CNBC published an article discussing common red flags to avoid filing tax returns. According to the network, the top reasons the IRS targets returns for an audit include unreported income, excessive write-offs compared to earnings, and refundable tax credits leading to negative tax liability.
Don't play the 'audit lottery.' These are the top reasons why your tax return may be flagged by the IRS https://t.co/aP6XIETHik
— CNBC (@CNBC) April 4, 2022
Certified Public Accountant and partner at PKF O’Connor Davies, John Apisa, told CNBC some filers like to “play the [tax] audit lottery,” meaning they will cut corners and try to get away with deceptive filing practices. However, he warned against trying to see what you can get away with regarding your obligations to Uncle Sam.
Additionally, although IRS audits usually fall under a three-year statute of limitations, they can file for extensions. However, there isn’t a time limitation for an audit of individuals failing to file taxes or if the agency suspects a person has committed fraud.
According to Apisa, the best way to avoid problems with IRS is to keep track of your receipts. He also said it’s best to maintain tax records for seven years. With the proper documents to back up your returns, “you don’t have to be scared,” he explained, adding IRS officials are typically “pretty reasonable.”
Have you filed your taxes yet this year?
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