10. Don’t forget about deductions if you earn a high income
If you’re able to make more money each year, good for you, but you must know that this might be an audit red flag. When you’re earning a high income, the chances of being audited increase significantly, so pay a closer look at your deductions.
Most tax experts say that tax returns reporting over $200,000 of income are most likely to be verified than those below that big threshold. If you’re playing in a whole different league, note that tax returns reporting more than $1 million, let’s say, are for sure audited.
Psst! Want to Avoid Paying Income Taxes? Here Are 12 States That Won’t Tax Your Retirement Income
