Avoiding IRS Audit Red Flags

Credit(s)

IRS CPE Credits: 1 Tax hour

IRS examinations can be costly, time-consuming, and stressful for both taxpayers and practitioners. This course provides a practical overview of the most common IRS audit triggers, strategies for reducing audit exposure, and proactive compliance practices. By understanding the IRS’s audit selection process and the red flags that commonly attract scrutiny, tax professionals can better advise clients, reduce audit risk, and prepare for potential inquiries.

Webinar Objectives

By the end of this session, participants will be able to:

• Identify the most common IRS audit triggers across individual and business returns.
• Explain how IRS data analytics and information matching contribute to audit selection.
• Evaluate specific high-risk deductions and credits that attract IRS attention.
• Implement documentation and substantiation strategies to withstand IRS review.
• Recognize red flags in financial reporting that increase audit risk.
• Advise clients on proactive compliance strategies to reduce exposure.

Webinar Agenda

• IRS audit selection process and use of data analytics.
• High-risk items: large charitable deductions, cash-intensive businesses, home office deductions.
• Schedule C risks: unreported income, excessive expenses, hobby loss rules.
• Corporate red flags: related-party transactions, high officer compensation, international reporting.
• Information mismatches with W-2s, 1099s, and K-1s.
• Documentation best practices: receipts, mileage logs, and substantiation.
• Proactive client communication to mitigate risk.

Who Should Attend

CPAs, attorneys, EAs, tax preparers