Tax Myth: Overpaying the IRS Makes You Audit Proof
By Sean M. Hugo, CPA
Tax season is upon us, and many are pondering about their 2016 taxes and how they will be treated by the good people at the Internal Revenue Service. If you just asked “when does tax season start?” you’re not alone - many are not aware that tax season starts technically on January 1st, and continues until the final possible date for filing - this year it’s April 18.
Will Overpaying the IRS Make Me Audit Proof?
Just as many don’t know about tax season’s start, many believe in various tax myths that may land them in hot water with the IRS.
One is the common belief that overpaying will ensure the IRS doesn’t audit you.
That does not quite work that way - there is no "vaccine" that will make your business immune to an audit if the IRS decides that you will have one.
The IRS won’t be impressed by you overpaying, and it will certainly penalize you if you underpay. What the IRS cares about is that your deductions are properly backed by both data and the law.
How Can I Avoid an IRS Audit?
We are sorry to say there are no shortcuts here: the best way to ensure the IRS won’t audit you is to keep good records of your expenses and enlist the help of an expert tax accountant to make sure you’re not knowingly overpaying… nor underpaying!