Disclaimer: While striving for accuracy, the writer is not a tax professional. As always, readers should consult a tax professional for tax advice.

Filing a Schedule C, Business Profit or Loss, increases a filer’s chance of being audited, according to Bernard S. Kent, co-author of "Price Waterhouse Coopers Guide to the 2005 Tax Rules," and is among the items that trigger closer inspection (red flags), according to the Internal Revenue Service (IRS).

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