The IRS uses automated algorithms to identify returns with suspicious expense patterns. Meals too high relative to revenue. Vehicle deductions at a suspicious 100%. Round-number expenses that look invented. Cash transactions that spike at year-end.
Most small business owners have no idea whether their spending looks normal — or like a target. An audit costs an average of $2,000 to $10,000+ in professional fees, time, and back-taxes. ReceiptLyzer shows you your risk profile before you file, while you can still fix it.
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Schedule C filers are audited — 4× the rate of W-2 employees
$8,000
average cost of handling an IRS audit, including professional fees and back-taxes
Fix First
audit triggers can be corrected before you file — not after the letter arrives
38
out of 100
Moderate Risk
2 factors need attention
Top Recommendation
Reduce your vehicle business-use claim from 100% to a realistic percentage. The IRS flags 100% business-use vehicle claims as a common audit trigger.
Meals & Entertainment Ratio
8% of total expenses
Round Number Expenses
12 receipts with exact round amounts
Weekend Business Expenses
4% of receipts on weekends
Home Office Deduction Size
Within IRS safe harbor limits
Cash Transaction Frequency
15% of expenses paid in cash
Vehicle Expense Consistency
100% business use claimed
Our AI examines the same patterns that IRS algorithms look for, giving you the chance to fix issues before filing your return.
Upload your business expenses throughout the year as you normally would. The more receipts you add, the more accurate your risk assessment becomes.
Our AI evaluates your spending across six risk factors that the IRS is known to scrutinize: meals ratios, round numbers, weekend expenses, home office size, cash frequency, and vehicle use claims.
Each risk factor gets a Low/Medium/High rating with specific recommendations to reduce your exposure. Fix flagged items before filing to minimize audit probability.
Based on publicly available IRS enforcement patterns and tax professional guidance.
The IRS flags businesses claiming unusually high meal deductions relative to revenue. We compare your ratio to industry norms.
Multiple expenses at exact round amounts ($50, $100, $200) signal potential fabrication. We count and flag these patterns.
A high percentage of business expenses on weekends and holidays can trigger scrutiny. We measure your weekend ratio.
Oversized home office deductions relative to home size are a known trigger. We check against IRS safe harbor limits.
Heavy cash usage makes expenses harder to verify. We flag when your cash receipt percentage exceeds typical thresholds.
Claiming 100% business use of a vehicle is the most common audit red flag. We analyze your mileage log for reasonableness.
Most people only learn about audit red flags after the IRS sends a notice. ReceiptLyzer gives you visibility into your risk profile throughout the year, so you can adjust your expense documentation and deduction claims before tax season.
This is not tax advice — it is data-driven risk awareness based on publicly documented IRS enforcement patterns. Always consult a tax professional for specific guidance.
6 IRS Risk Factors
Continuously monitored and scored as you add receipts. Fix issues before tax season, not after an audit notice arrives.
Do not wait for the IRS to find problems. Upload your receipts and get an instant risk assessment with recommendations you can act on today.
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