Here is the down and dirty list on the best ways to avoid being audited by the IRS or the State, but we suggest you read the whole article by clicking on the link below.

1. Keep receipts
2. File your tax returns on time (even if you owe and can’t pay)
3. Be aware of your industry averages and common expenses
4. Attach additional statements and comments
5. Avoid Schedule C
6. Issue your own 1099s
7. File payroll reports and remit your payroll withholding
8. Avoid round numbers
9. Don’t inflate the home office deduction
10. Avoid taking excessive dining, travel and entertainment expenses

Click here to read The Top 10 Ways to Avoid an IRS or State Audit, by Mark J. Kohler (posted on sfgate.com)