No one wants to get audited on their taxes. But making some mistakes can almost guarantee that your tax return will get extra attention from the IRS.
In the following video, Dan Caplinger, The Motley Fool's director of investment planning, talks about the one thing you need to be sure you do on your taxes: match up the figures on your return to those that get reported directly to the IRS. Dan notes that everything from wage income on W-2s to investment and other income on 1099s goes directly into IRS computers, and if your return fails to match up with those records, it can raise a red flag that could cost you money in interest and penalties. He also recommends checking tax withholding and other figures to ensure you don't slip up with math errors that could get you audited.
Take advantage of this little-known tax "loophole"
Recent tax increases have affected nearly every American taxpayer. But with the right planning, you can take steps to take control of your taxes and potentially even lower your tax bill. In our brand-new special report "The IRS Is Daring You to Make This Investment Now!," you'll learn about the simple strategy to take advantage of a little-known IRS rule. Don't miss out on advice that could help you cut taxes for decades to come. Click here to learn more.
Dan Caplinger and the Motley Fool have no position in any stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.