I just finished up an article on the
main site about some simple steps
you can take to help avoid
a tax audit

They include:

1. Make sure all the math calculations
on your return are correct

2. Be sure to sign your tax return.

3. Be sure to fill out form 4868 to get
an extension if you can’t file on time.

4. If reporting income on your tax form that differes from your income statements, explain why.

5. Be proactive and write a thorough explanation if there is something significantly different on this year’s tax return compared to previous years.

There are also certain forms that if you fill out will increase your likelihood of being audited. This doesn’t means you should not take the deduction you’re entitled to take, but it does mean that you want to be extra thorough in documenting all the deductions you do take when using these so that if you are audited, there won’t be any questions regarding your deductions. For example, if you file Schedule C (for self-employed) or take the home-office deduction, you increase the chances of being audited.

In the end, you want to be aggressive and claim all the breaks and credits that you have coming, but in doing so, you want to also make sure that you have the supporting documentation to back up your claims.