Including flow through entities such as partnerships

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including "flow-through entities" such as partnerships and Subchapter-S corporations, as do self-employed individuals who file Schedule C. In fact, Schedule-C filers earning between $100,000 and $200,000 face especially high odds, with 4.3% of these returns audited. Researcher CCH cites several types of deduction attempts that raise red flags for a good reason: They aren't allowed. These include a loss on your home, excessive moving expenses and medical deductions for unneeded cosmetic surgery. Nobody draws scrutiny like parents adopting a child. A staggering 69% of returns claiming the adoption credit were audited last year, noted Nina Olson, the National Taxpayer Advocate. Safeguard your identity . Although most people fear audits, being victimized by tax fraud could be the bigger risk. The IRS said it prevented fraudulent refund payments last year on about 3 million returns, or three times the number it audited. Taxpayer ID thefts mainly involve fraudulent requests for refunds using another person's Social Security number. . Crooks typically file early, before the actual taxpayer, and have the refund check diverted to them. When a crook gets there first, that can delay a refund to the real taxpayer for six months or more while the IRS investigates. Such thefts also cost the federal government, because a refund eventually will be paid to the rightful taxpayer even after payment of a fraudulent refund.
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All this should serve as a reminder to safeguard personal information. . One thing that many people probably don't secure as they should is a smartphone. Adam Levin, chairman of Credit.com, discourages people from storing Social Security numbers and those for credit or bank accounts on phones. "Make sure to delete all
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including flow through entities such as partnerships and...

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