> ## Documentation Index
> Fetch the complete documentation index at: https://docs.taxhomebase.com/llms.txt
> Use this file to discover all available pages before exploring further.

# Audit Preparation

> Common audit triggers for travel nurses, document retention, and how to build your defense.

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Travel nurses face a higher audit risk than average taxpayers due to the complexity of their tax situations — tax-free stipends, multi-state income, and significant deductions are all areas the IRS scrutinizes. Being prepared is your best defense.

## Common Audit Triggers

| Trigger                                | Why It Raises Flags                                          |
| -------------------------------------- | ------------------------------------------------------------ |
| **Large tax-free stipends**            | The IRS wants to verify you qualify                          |
| **No documented tax home**             | Without proof of a permanent residence, stipends are taxable |
| **Excessive deductions**               | Deductions that seem high relative to income                 |
| **Multi-state filing inconsistencies** | Income reported differently across state returns             |
| **Missing W-2/1099 reconciliation**    | Discrepancies between what agencies report and what you file |
| **High mileage claims**                | Without contemporaneous logs, mileage deductions are denied  |

## Document Retention

The IRS generally has **3 years** from your filing date to audit a return (6 years if they suspect substantial underreporting). Tax professionals generally recommend retaining records for at least 3 years, and up to 6 years for travel nurse documentation.

### What to Keep

| Document                       | Purpose                           | Retention |
| ------------------------------ | --------------------------------- | --------- |
| W-2s and 1099s                 | Income verification               | 6 years   |
| Assignment contracts           | Proves temporary work arrangement | 6 years   |
| Lease / mortgage statements    | Tax home proof                    | 6 years   |
| Rent receipts                  | Ongoing payment proof             | 6 years   |
| Utility bills                  | Home is occupied, not vacant      | 3 years   |
| Expense receipts               | Deduction substantiation          | 3 years   |
| Mileage logs                   | Vehicle deduction proof           | 3 years   |
| Voter registration / DL copies | Tax home ties                     | 6 years   |
| Travel receipts (return trips) | Proves regular tax home visits    | 3 years   |

## Building Your Defense

### 1. Establish Your Tax Home Early

TaxHomeBase's [Tax Home](/guides/tax-home) feature lets you document your permanent residence from the start. The IRS gives more weight to contemporaneous evidence — documentation created at or near the time of the events.

### 2. Track Everything as It Happens

* The IRS values records made at or near the time of each event
* Receipt uploads and mileage logs are strongest when created the same day
* Updating visit dates promptly creates a contemporaneous record
* Monthly tax home cost tracking builds a consistent paper trail

### 3. Monitor Your Compliance Score

TaxHomeBase's [100-point weighted audit readiness score](/guides/audit-readiness) checks:

* 7 core tax home criteria
* 4 documentation completeness criteria

Each failing criterion represents a potential audit vulnerability. An 11/11 score indicates strong audit preparedness.

### 4. Reconcile Income Documents

Use the [Income Documents](/guides/income-docs) page to:

* Track expected W-2s/1099s per agency
* Upload documents as they arrive
* Reconcile reported wages against your tracked income
* Flag discrepancies (>1% variance)

### 5. Export Your Package

Before filing, generate your [Audit-Ready Tax Package](/guides/export):

* **PDF** — Summary, state breakdown, audit defense checklist, GSA compliance, mileage log
* **CSV exports** — Expense detail, state income breakdown, mileage log
* **ZIP download** — Everything bundled together

## If You're Audited

1. **Context** — Correspondence audits (by mail) are the most common and least invasive type
2. **Deadlines matter** — The IRS typically gives 30 days to respond; extensions may be available
3. **Professional help** — A CPA specializing in travel nurses understands the specific rules and can represent you
4. **Organized records help** — TaxHomeBase's export package organizes documentation in an audit-friendly format
5. **Scope** — Tax professionals generally advise responding only to what is specifically requested