With the April 15th deadline fast approaching, taxpayers need to stay vigilant about what they report (and don’t report) on their tax returns in order to avoid being audited by the IRS or incurring heavy IRS penalties.
CNNMoney released an article recently that outlines several helpful tips for taxpayers to heed in order to prevent getting audited by the IRS. It’s important for taxpayers of all income brackets to realize that with the government strapped for money, there is no “fish too small” for the IRS to scrutinize.
Among the useful tips to keep in mind are:
Prove the legitimacy of your self-employment status
A lot of people may be turning hobbies into income sources in this struggling high-unemployment economy, making the IRS increasingly skeptical of the legitimacy of many home-based businesses. To avoid IRS trouble, keep good documents and records of your business so that you can easily prove your employment status when necessary.
You also need to be careful about what deductions you claim for your own business. The IRS will grow suspicious of abnormally high business expense deductions for things such as travel, entertainment, and meals.
Disclose overseas bank accounts
If we learned anything from the UBS crackdown, it’s that no place is safe from the IRS grasp. Even if you don’t have an enormous amount of money abroad, follow the guidelines and IRS rules for disclosure to avoid heavy penalties.
If you are in IRS trouble for failure to disclose your offshore funds, you can get tax help from a tax attorney, CPA, or Certified Tax Resolution Specialist. Consult our special Offshore Tax Evasion Defense Division for more tax help.
Earning the big bucks? Hire a Pro!
According to CNNMoney, taxpayers who earn more than $200,000 a year are 50% more likely to get audited by the IRS than those who earn less.
“Because high earners have more income and more deductions on their returns, such as businesses, second homes, stock transactions and charitable contributions, the chances of miscalculation or inflation are much greater. The more money a person makes, the more valuable those errors becomes to the IRS.”
The best thing for you to do if you’re a high earner and feel that you may be caught in IRS crosshairs is to hire a professional tax attorney. The expertise of a good tax attorney, CPA, or Certified Tax Resolution Specialist will maximize your chances of winning an affordable tax settlement such as an installment agreement or penalty abatement.
Read the full CNNMoney article to learn more ways that you can avoid an IRS audit and how you can protect yourself from getting in deep trouble with the IRS.
Tax Resolution Services is a team of expert tax attorneys, CPAs, and Certified Tax Resolution Specialists who are here to help you with your tax problems. Call our office today at 1-866-IRS-PROBLEMS or visit www.taxresolution.com for a free tax resolution consultation.
More Tax Help, IRS News and Tax Relief Tips:
- Tax Help For Offshore Account Holders as Swiss Government Seeks to Salvage UBS Agreement
- Tax Help Options For Overseas Tax Evasion as UBS Pushes For Swiss-US Deal
- Your Unfiled Delinquent Tax Return Checklist: Stop the IRS Now and Avoid Steep Interest and Penalties from Accumulating
- IRS Help and Income Tax Relief for Individuals and Businesses Unable to Meet Tax Obligations
- UBS To Disclose Offshore Account Holders Details to IRS: Act NOW to Reduce Severe Penalties
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