Taxpayers may be aware of some of the common triggers that lead to an audit by the Internal Revenue Service (IRS). These can include a large amount of wealth, having foreign assets and small business ownership.
The hidden cost of an audit
Avoid these common tax penalties in 2019
The United States tax code is a complex beast. A failure to abide by the rules outlined in the code can result in serious consequences. Depending on the details of the allegations, the consequences for a failure to follow this code can range from relatively minor financial penalties to serious prison sentences.
Think the IRS can only look-back 3 years? 2 times you are wrong.
If there are questions about your tax returns, the Internal Revenue Service (IRS) can generally look back three years — but there are some exceptions that allow the agency to look back even longer. Two of the most common reasons for an extended look-back period: omission of income and a failure to file returns.
Tips to avoid an IRS audit in 2018
The Internal Revenue Service (IRS) audited an estimated 1.1 million tax returns in 2017. Those who are concerned about an audit likely have the following questions:
Taxes and vacation property: 3 changes
Those who rent and use vacation property likely purchased the real estate with tax savings in mind. Although these tax savings may still be available, the passage of the Tax Cuts and Jobs Act (TCJA) has changed how taxes are applied to second properties.
How does the IRS substantiate charitable donations?
The Internal Revenue Service (IRS) may not take your claim of a charitable donation at your word. In some cases, the agency may require additional information to substantiate the claim. Just how the agency goes about substantiating the claim can vary, but three specific things the IRS tends to expect in these situations include:
Is the new 1040 form really going to be a postcard?
President Donald Trump and his administration have made many promises in light of recent tax reform. In addition to reducing most taxpayer's overall tax obligations, the administration also promised to unveil a "postcard-sized income tax return" to simply tax filings for the 2018 tax year.
What happens when the IRS audits a tax return?
Think the IRS is about to conduct an audit of your tax returns? The following basic questions and answers can help you get through the process with minimal stress.
Tax crimes and prison time: 4 examples from 2017
The Internal Revenue Service (IRS) audited approximately 934,000 tax returns in 2017. The IRS conducted 70.8 percent of these audits via a mailed correspondence and 29.2 through a full field investigation.
Home equity loans and the new tax law: Clarification from the IRS
The Internal Revenue Service (IRS) recently published clarification on how the new tax law impacts deductions for interest paid on home equity loans. The agency notes that there are restrictions, but many homeowners can still qualify for these deductions.
