The deadline for Tax Season 2023 for individuals is over, and those who filed for refunds will be receiving the same within 21 days from the filing date.  But, If the taxpayers have received a notice from the IRS that their taxes are incorrect or that they owe money, they can either pay or dispute if IRS is wrong. There are options available to resolve such disputes. The IRS dispute process is an essential part of the tax system, but it can be complicated and intimidating. Managing a dispute with IRS can be a complex and compelling process for taxpayers. Following are the steps to manage a dispute with the IRS. The first step in managing an IRS dispute is understanding how the process works, and what options are available for appealing or litigating the issue at hand.

Understanding the IRS Dispute Process

The IRS dispute procedure consists of numerous steps. Taxpayers can file a dispute if they disagree with the amount of tax they are required to pay or believe the IRS made a mistake in their tax return. If there are any changes that would affect their refund or balance payable, the first step is to file Form 1040X. Taxpayers can submit Form 9465, Form 8857, or Form 843 with the required supporting paperwork if there are no changes. These forms include Instalments Agreement Request, Request for Innocent Spouse Relief, and Claim for Refund and Request for Abatement, respectively. Ensure that taxpayers submit all required forms and documents to initiate the dispute process.

If there is no communication from the IRS regarding the dispute after 90 days from the filing, it is time to move forward with appealing their decision. To do so, follow these steps:

Appealing IRS decision

Taxpayers have the right to appeal an IRS decision, and taxpayers have the right to use the two-step appeals process which involves an administrative appeal. Taxpayers need to submit a written request for reconsideration to the office that made the initial decision within 60 days of receiving a letter of disallowance. This can be done by letter, fax, or online at www.irs.gov/appeals. Taxpayers can request Form 12356-A, which offers guidance on how to complete and submit the appeals with necessary supporting evidence. This phase of the investigation aims to identify why the IRS took certain actions, such as reducing refunds.

Litigating IRS Dispute

Taxpayers need to take legal action if they are unable to resolve their dispute with the IRS. The IRS offers several options for litigating disputes that include.

• Filing a lawsuit against the IRS in court. If a taxpayer has a valid reason for disputing an assessment or collection activity, they can file suit against the IRS in federal court or state court if applicable. Throughout this process, they need a tax attorney who specializes in tax law to represent them.
• Requesting a management hearing with the Appeals Office Reviewer (AOR) is another option when appealing an IRS decision. AOR evaluation from the relevant evidence before determining whether to grant relief or not. This step does not guarantee relief, but it’s usually the first taken in appeals.

The IRS dispute process can be confusing, but it’s important to know taxpayers’ options. It is important to understand the steps included and the options available to taxpayers for resolving the issue. This may include communications with IRS and providing additional information to support their position, requesting an appeals conference with an independent appeals officer, or considering mediation. In some cases, litigation may be necessary. Therefore, seeking tax professional advice and guidance throughout the process can help ensure that taxpayer’s rights are protected and they’re able to achieve the best possible outcome. IRS Audit Group is a tax audit representation company that helps taxpayers navigate such time-consuming dispute processes. Contact us for a free consultation. https://irsauditgroup.com/contact/

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There are times when Taxpayers choose to represent themselves in an IRS audit or hire a tax professional to handle the case on their behalf. Those who want to avoid paying legal fees or who feel they have a thorough understanding of tax law may find self-representation to be intriguing. However, it also comes with its own set of risks and potential downsides. Here are some of the pros and cons of self-representation during an IRS audit, and helps taxpayers make an informed decision about how best to handle their audit.

Pros of Self-Representation

Cost Savings: One of the biggest benefits of self-representation is savings on account of Auditor fees. Taxpayers who represent themselves are not required to pay for tax audit representation services. Particularly for individuals or small-business owners who are on a limited budget, this gives considerable savings.

Better Control: The taxpayer has more influence over the process when they act as their own representative. They are in charge of gathering and submitting the required paperwork and data. This enables them to ensure that everything is conducted appropriately and to comprehend every step of the procedure.

Knowledge Enhancement: Self-representation can also be an excellent opportunity to learn more about tax law and the audit process. To make sure they are presenting their case appropriately, the taxpayer will need to read and comprehend tax laws and processes. The knowledge and experience gained will be useful for conducting business thereafter.

Cons of Self-Representation

Lack of Expertise: The audit process can be intimidating for taxpayers who are not familiar with tax law because it is complicated. An established tax audit representation company has experts who have extensive knowledge of tax law with years of experience dealing with the IRS. They are better prepared to identify any deductions or credits that taxpayer misses, and they can ensure that their representation is accurate and complete.

Reduced Emotional Distress: An IRS audit can be stressful, and self-representation can amplify that stress. The IRS correspondence can be handled entirely on behalf of the taxpayer by a tax audit representation firm, lessening their emotional burden and enabling them to concentrate on other facets of their lives.

Timesaving: Self-representation consumes time, and taxpayers who are familiar with the audit procedure would end up with mistakes and omissions. The documentation and correspondence with the IRS can be overseen by a qualified tax audit representation firm, saving the taxpayers’ time and guaranteeing that everything is done correctly.

Reduced Risk of Penalties: If a taxpayer makes a mistake in representation, it could result in penalties or interest charges. A tax professional has the knowledge to guarantee correct and thorough taxpayer representation, lowering the possibility of fines and interest charges.

Self-representation during an IRS audit seems like a cost-worthwhile option, but it is important to consider the potential drawbacks. The lack of proficiency, emotional distress, and time-consuming nature of the process can ultimately lead to mistakes, which can result in fines and interest charges. Therefore, it is generally suitable to seek the services of a professional tax audit representation company. Their experts can provide the necessary knowledge and experience to navigate the audit process successfully and minimize the risk of penalties and interest charges.

If you are facing an IRS audit and require assistance, reach out to the IRS Audit Group based in Los Angeles. We specialize in tax audit representation and aim to guide taxpayers through the audit process while safeguarding their rights. Our team has Lawyers, CPA,s and Enrolled agents who can carefully examine your tax records and returns, communicate with the IRS on your behalf, represent you during the audit, and negotiate with the IRS to help you avoid the stressful ordeal. We ensure that clients achieve the best possible outcome from the audit process. You can contact us to schedule a free consultation. https://irsauditgroup.com/contact/

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IRS is known for being severe and unforgiving, even for minor inaccuracies on taxpayers’ returns. This can result in auditing your tax return and imposing substantial fines and interest.  Dealing with an IRS audit can be a worrying and compelling experience, particularly for those who are not familiar with the tax code and audit process. This is where an IRS audit representation company can step in to make the process easier.

Role of IRS Audit Representation

• Communication: During an audit, an IRS audit representation firm serves as the taxpayer’s point of contact with the IRS. All correspondence, including information requests, inquiries, and scheduling appointments with the auditor, will be handled by them.
• Strategy development: An IRS audit representation service will create a plan for responding to the audit based on their analysis. Obtaining more evidence or data may be necessary, or the auditor’s conclusions may need to be contested.
• Analysis: Tax returns and financial documents will be examined by an experienced tax attorney to find any potential problems. Additionally, they will examine the audit results and determine any potential effects on tax liability.
• Negotiation: A taxpayer’s complaints or disagreements with the IRS during the audit process will be resolved through negotiation on their behalf by an IRS audit representation company. They will attempt to minimize any fines or interest imposed and to get the best result for the taxpayers.
• Education: Taxpayers will learn about the audit process, their rights as taxpayers, and any possible repercussions. The taxpayer will be better able to comprehend what’s happening and decide how to move forward in avoiding further IRS audits.

Overall, an IRS audit representation company will fight to uphold the rights of taxpayers, guarantee a fair and accurate audit, and represent their interests at every stage.

Benefits Of Hiring an Experienced Tax Attorney

• Expertise: A professional tax lawyer is knowledgeable and skilled in tax law and IRS processes. This can be quite helpful when negotiating with the IRS and navigating the audit process. They are knowledgeable about the intricacies of the tax code and can offer the required direction to guarantee that the taxpayer’s rights are upheld.
• Long-Term Tax Planning: Long-term tax planning advice and direction can also be obtained from a tax attorney. This can lessen taxpayers’ tax obligations and help them avoid further audits.
• Peace of Mind: A taxpayer may feel more at ease knowing they have a skilled tax attorney on their side. Taxpayers will be aware that a competent and experienced professional is defending their rights and advancing their interests. This can reduce the tension and worry brought on by an IRS audit.
• Protection of Taxpayer Rights: Throughout the auditing process, a tax attorney can defend the legal rights of the taxpayer. They can make sure that the IRS does not unfairly target taxpayers and that their rights are upheld while being audited. They can also guarantee that the IRS complies with all legal requirements and respects taxpayers’ rights.

Facing an IRS audit can be a difficult task, but the good news is that taxpayers don’t have to do it alone. An IRS audit representation company with its tax attorneys can help navigate the audit process and protect taxpayers’ rights. IRS Audit Group, based in Los Angeles, can support taxpayers who need help in the IRS audit. To save you from going through the stressful procedure you can Contact us for free consultation. https://irsauditgroup.com/contact/

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Tax Season 2023’s due date for Tax-Exempt Organisations is May 15, 2023, to file returns. Numerous tax-exempt organizations have received reminders from the IRS on their forthcoming filing deadline of May 15, 2023. Tax-exempt organizations often need to submit certain reports by the 15th day of the fifth month after the end of their accounting period. However, if the 15th falls on a weekend or holiday, the due date is extended to the next business day.

What are Tax Exempt Organizations and Who Are Eligible?

Entities that are excused by IRS from paying federal income tax are known as Tax-exempt organizations. These organizations need to run solely for reasons of religion, charity, science, literature, education, or the prevention of cruelty to children or animals. Charitable organizations, churches and other religious institutions, educational institutions, hospitals, and social welfare organizations are examples of tax-exempt organizations. One can also find out whether an organization is tax-exempt using the IRS tool provided.

How to File the Returns for Tax Season 2023?

To make it easier to comply with reporting obligations, tax-exempt organizations are encouraged to file their returns electronically. Electronic filing provides a quick acknowledgment of the IRS receiving the return and reduces processing time. For the tax season 2023, organizations filing Form 990, 990-EZ, 990-PF, or 990-T must submit their returns electronically, and private foundations filing Form 4720 must also file the form electronically. Charities and other tax-exempt organizations can file these forms electronically using an IRS-authorized e-File Provider. Furthermore, organizations eligible to submit Form 990-N need to do so electronically and can use Form 990-N (e-Postcard) on the IRS website to file. By filing their tax returns electronically, tax-exempt organizations can comply with the reporting requirements quickly and efficiently.

Apply for an Extension of Time to File the Tax Returns for 2022

If a tax-exempt organization is unable to file its return by the due date, it can request an extension of time to file using Form 8868, Application for Extension of Time to File an Exempt Organization Return. This form must also be filed by the deadline of the tax season 2023, i.e., May 15, 2023. The extension provides an additional six months to file the tax return. However, the extension does not extend the time to pay any taxes owed, it only allows the organizations to file the returns at a later date. Organizations that cannot pay any taxes owed by the original due date may be subject to penalties and interest.

Avoid these Errors While Filing for the Tax Season 2023

Tax-exempt organizations can avoid penalties and interest by avoiding common errors when filing their tax returns. IRS warns of a few common mistakes such as

• Failing to file on time or requesting an extension.
• Not disclosing all sources of income, including income from unrelated businesses.
• Failing to disclose expenses accurately, such as compensation paid to officers and directors.
• Failing to include all necessary schedules and disclosures.
• Failing to maintain adequate records and documentation to support the tax return.

Tax-exempt organizations should take the appropriate precautions to ensure that their tax returns are filed accurately and on time to avoid errors, including maintaining thorough records, checking their tax forms before submitting them, and seeking expert assistance like a tax professional as needed.

In case one need assistance in filing or disputing the tax owed, the IRS Audit Group from Los Angeles can help. IRS Audit Group is a tax audit representation company that helps taxpayers navigate the audit process and ensure that their rights are protected during the audit. We review your tax records and returns, communicate with the IRS, represent you at the audit, and negotiate with the IRS so that you don’t have to go through a stressful process. We ensure the best possible outcome for the clients. Contact us for a free consultation.

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Tax season can be a stressful time for those who run behind the filing schedule. Taxpayers who aren’t able to file their returns for tax season 2023 by April 18, 2023, deadline, can request an extension. Filing an extension will give an additional six months to file taxes. However, it is important to note that an extension does not give taxpayers extra time to pay any taxes owed. Taxpayers need to pay their federal income tax due by April 18, 2023, to avoid interest and penalties.

If you have missed paying the taxes and/or failure to file an extension before the deadline, the following options are the next actions available now.

Option 1: Pay Taxes as Soon as Possible.

If one owes taxes, it is important to pay them as soon as possible. If you are unable to pay the full amount, then can still make a partial payment to reduce the amount of interest and penalties. Taxpayers can make a payment online using the IRS Direct Pay system, which allows individuals to pay directly from their bank account. Taxpayers can also pay by credit or with a debit card, with certain additional fees associated with this method.

Option 2: Set Up a Payment Plan

The IRS gives an option for taxpayers who cannot pay the full amount owed all at once. They can set up a payment plan with the IRS. This will allow taxpayers to make monthly payments until the balance amount is paid in full. To set up a payment plan, an individual needs to fill out Form 9465.

There are two types of payment plans available: short-term and long-term. A short-term payment plan allows payment of the balance in full within 120 days. No extra fee associated with this plan, but interest and penalties will continue to accrue until the balance is paid in full. A long-term payment plan allows payment of a balance over a period of several months or years. There is a fee associated with this plan, and interest and penalties will continue to accrue until the balance is paid in full.

Option 3: Offer in Compromise

If the taxpayer is unable to pay the full amount owed and can’t set up a payment plan, they are eligible for an Offer in Compromise. This is an agreement between the taxpayer and the IRS to settle the debt for less than the full amount owed. To be eligible for an Offer of Compromise, one needs to demonstrate that paying the full amount owed would cause financial hardship. And also need to provide detailed financial information, including their income, expenses, assets, and liabilities. To apply for an Offer in Compromise, the individual needs to fill out Form 656. It is important to note that an Offer in Compromise is not guaranteed, and the IRS will carefully review the individual’s financial information before making a decision.

In case an individual has missed the tax season 2023 deadline and owes taxes; it is important to act as soon as possible. Filing an extension, paying taxes as soon as possible, setting up a payment plan, or exploring an Offer in Compromise are all options to consider. Be sure to consult with a tax professional to determine the best course of action for the specific situation.

IRS Audit Group is Los Angeles-based company that offers tax audit representation services to individuals and businesses facing IRS audits or disputes. The company’s team consists of CPAs, tax attorneys, and enrolled agents who have experience working on both sides of tax disputes. If you receive any mail from IRS regarding a tax audit, don’t panic and don’t delay, contact a tax professional who is experienced in handling IRS audits by us. Contact us for a free consultation on understanding your tax situation.

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The Internal Revenue Service (IRS) has recently announced that around 1.5 million people across the country have not yet claimed their refunds for the tax year 2019. However, the deadline to file the returns is July 17, 2023, which is three years after the usual deadline. Due to the COVID-19 pandemic crisis, the IRS deferred the deadline for 2019 unfiled returns. The average median refund for 2019 is $893, and the IRS has estimated that $1.5 billion in refunds are still unclaimed.

Many taxpayers may have forgotten or ignored their tax refunds since 2019 due to the pandemic. To prevent losing out on the opportunity, taxpayers need to submit their refund requests prior to the deadline. Typically, individuals have three years to file their tax returns and request any refunds.

While many people would have missed out on filing their tax returns due to the unusual situation caused by the pandemic, some stand to lose more than just their refund of taxes withheld or paid during 2019. Earned Income Tax benefit (EITC) is a tax benefit that many low – and moderate-income employees are eligible for. The credit’s maximum value for 2019 was $6,557. The EITC provides assistance when an individual or family’s income is below a specific threshold. Those who qualified for the EITC in 2019 had incomes below particular thresholds, based on the number of qualifying children.

Taxpayers requesting a 2019 tax refund should also be aware that their checks will be held if they fail to file tax returns for 2020 and 2021. Additionally, the refund will be applied to any amounts still owed to the IRS or a state tax agency and may be used to offset unpaid child support or past-due federal debts, such as student loans.

Where To Obtain Essential Documents for Filing 2019 Tax Return?

Even though the tax year was three years ago, the IRS has offered taxpayers several ways to access the data they need to submit their 2019 tax forms. To ensure taxpayers have enough time to file before the deadline, IRS advises people to get started as soon as possible. One approach is to ask their employer, bank, or other payers for copies of important records like Forms W-2, 1098, 1099, or 5498. Another choice is to order a free wage and income transcript via Get Transcript Online at IRS.gov. For many taxpayers, this instrument is by far the quickest and easiest choice. As an alternative, individuals can submit Form 4506-T to the IRS to obtain a “wage and income transcript.” However, it is essential to plan since written requests can take several weeks.

Depending on a household’s tax circumstances, the actual refund amount can change. Therefore, to avoid missing the deadline, taxpayers are urged to review their records and start gathering documentation.

IRS Audit Group is a tax audit representation firm located in Los Angeles, California. If the IRS requires more information to validate your tax return filing, they may ask for it, and in rare cases, they may initiate a tax audit via mail notice. In such situations, it is crucial to have the assistance of a licensed tax professional like the ones at IRS Audit Group. IRS Audit Group is comprised of qualified CPAs and IRS Enrolled Agents. They can analyze your tax situation and help alleviate the burden of dealing with an IRS audit. Having proper representation in an IRS audit is essential, and the IRS Audit Group can provide the necessary support to navigate the process successfully. To learn more about our services, visit the website and contact us for further information.

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Small business owners find it hard to go through an IRS audit. After receiving an audit notice, the first thing to do is to thoroughly read it and gather all necessary paperwork. Consulting with a tax professional will always help you understand the audit process and ensure compliance with tax laws. When responding to IRS, please note to pay special attention to the details. Any mistakes or discrepancies will raise more queries or guarantee additional research. The procedure can go more easily if taxpayers reply to the IRS right away, and act professionally while being audited. Taxpayers can even dispute the IRS’s decision if it determines they are bound to pay additional taxes or fines.

General IRS Audit Process

The general process of an IRS audit involves several stages. The exact process varies depending on the type and scope of the IRS audit, but the following outline is a general overview.

• Notification: The IRS will send a notification letter to inform the taxpayer that they have been selected for a tax audit. The letter will outline the reason behind the audit as well as the paperwork the taxpayer must submit.
• Preparation: The taxpayer is required to compile all essential records and papers for the audit. To comprehend the audit procedure and make sure they follow tax rules, they can consult with a tax professional.
• Examination: To ensure that the tax return is accurate, the IRS will review the taxpayer’s files and records. An on-site visit to the taxpayer’s residence or place of business may be necessary.
• Communication: The IRS will keep in touch with the taxpayer during the IRS audit process to clarify any problems or discrepancies discovered and, if necessary, to request further information or documents.
• Resolution: The IRS will report any changes that need to be made to the taxpayer’s filed return after the examination is finished. The taxpayer will have the chance to refute any conclusions or bargain a deal with the IRS.
• Appeals: The taxpayer has the right to challenge the judgment in court or through an administrative procedure with the IRS if they disagree with the audit’s conclusion.

Overall, the process of an IRS audit can be complex and time-consuming, but being prepared and cooperating with the IRS always helps the process go more smoothly. Complex IRS audits need tax professional help from a tax audit representation company that can analyze your circumstances and represent on behalf of you in front of the IRS for the audit sessions.

How Long Will the Audit Process Take?

Several variables can affect how long an IRS audit lasts. The sort of audit being undertaken is one of the important factors. For instance, if a correspondence audit just entails looking through a small portion of a taxpayer’s return, it might be finished in a couple of weeks. On the other hand, a field audit that needs to visit the taxpayer’s place of business or residence and study a substantial number of records will take several months.

The complexity of the taxpayer’s return, the volume of records and papers being examined, and the IRS agents’ and taxpayers’ availability are additional elements that affect audit tenure. Additionally, if the audit identifies issues or discrepancies that require further review, the process will take longer.

It’s crucial to keep in mind that the timeframe of an IRS audit can be extended if the taxpayer refuses to provide information or documents when requested, contests the audit’s conclusions, or tries to reach a settlement with the IRS.

The duration of an IRS audit varies significantly based on the particulars of each case. But taxpayers can attempt to keep the process moving and make sure that the audit is finished as soon and effectively as possible by collaborating with the IRS agent.

These time-consuming audits can frustrate small business owners as they have to deal with extra work besides running their companies. Also, they will not find enough time to meet the IRS agents and answer all the questions. Thus a tax audit representation firm like IRS Audit Group can help them by representing on behalf of the client. The company is located in Los Angeles, California but as the IRS is a Federal Agency, we can request the case to be transferred to a local IRS office in Los Angeles. Contact us to learn more about our services and get a free consultation on your case.

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Cryptocurrencies and other digital assets have experienced an increase in activity and acceptance by the public in recent years. For this Tax Season 2023, the IRS has increased its efforts to provide assistance to taxpayers on the tax treatment and reporting requirements related to these digital assets. The IRS has introduced the new term “digital assets“ to refer to “virtual currencies”.

What is Digital Asset?

Any digital representation of value that is on a cryptographically protected distributable ledger or any other equivalent technology as specified by the Secretary is referred to as a digital asset, according to the IRS. The IRS lists a number of instances of digital assets, including NFTs, stablecoins, as well as virtual currencies like a cryptocurrency that can be used for payments (non-fungible tokens that are unique digital identifiers recorded in a blockchain).

Disclosure on Individual Tax Return 

To assist taxpayers in providing accurate answers, the guidelines for answering the question have been clarified and broadened in this tax year 2022 forms. Every individual filer must respond to the question with simple “yes” or “no” answers on the front of Form 1040, U.S. Individual Income Tax Return, whether they received or sold a digital asset in the tax year 2022, regardless of whether they are associated with digital assets or not. The subject, which is now on 2022 forms, gives more information and specificity to help taxpayers understand when to correctly mark the “Yes” or “No” boxes.

When to Check “Yes” Or “No”?

In general, if a taxpayer got digital assets in the form of a payment, prize, or award, they should check “Yes”. Also, a taxpayer should select “Yes” if they obtained digital assets as a result of mining or a hard fork (the division of a cryptocurrency into two). A taxpayer should also tick “Yes” if they have given up any other financial stake in a digital asset by payment, sale, exchange, or swap for another digital asset. Check “No” if a taxpayer simply owned digital assets during the year without engaging in any transactions. A taxpayer should also select “No” when transferring digital assets between accounts that share the same owners or when buying digital assets with money that isn’t digital.

How to Report Digital Asset Income?

Digital asset income is reported in much the same way as other revenue, mostly dependent on the source of the income. If digital assets are received in exchange for work, the taxpayer must disclose the value of those assets as wages on your tax return 2022. If the digital assets received were payment for services provided, the value of those assets would be reported on Schedule C, Profit or Loss from Business. Similarly, Schedule C would also record any such dispositions of digital assets to clients made in the course of a trade or company.

If digital assets are held as capital assets and sold, exchanged, or transferred it during the tax year 2022, the investor must use Form 8949, Sales and Other Dispositions of Capital Assets to calculate the gain or loss from that activity. The gain or loss is then reported on Schedule D, Capital Gains, and Losses. If, however, digital assets were transferred to an individual as a gift other than the taxpayer’s spouse during the tax year 2022, Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, will generally need to be filed if the value exceeds $16,000.

An incorrect or false response to the updated digital asset question could create complications for taxpayers in the future. For instance, an incorrect response may result in various types of penalties. The advice and assistance from knowledgeable Dual Licensed Tax Professionals and CPAs might be helpful when deciding how to answer the digital asset question instance.

IRS Audit Group is a tax audit representation firm in Los Angeles, California. Usually, in a few cases, the IRS may ask for more information to validate the tax return filings. But rarely, IRS may like to audit your tax information through a letter of notice via Mail. In such cases, it is important to engage a tax professional like ours to represent your tax audit. Our licensed professionals comprise qualified CPAs and IRS Enrolled Agents. They can analyze your tax situation and help alleviate your burden. Please contact us for more information. https://irsauditgroup.com/contact/

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The Internal Revenue Service (IRS) has issued warnings of new scams that urge taxpayers to use wage information on a tax return to claim false credits in hopes of getting a big refund. The new scheme circulating on social media encourages people to use tax software to fill out a Form W-2 to include false information. Scam artists encourage taxpayers to make up numbers showing large amounts of income and related withholding. Then, the scammers suggest simply e-file a bogus tax return to snag a large refund due to the amount of fake withholding. This deliberate misinformation about inflated income is used to take advantage of refundable tax credits.

Scam Variations

Two variations of this scheme are also being seen by the IRS; both involve misusing Form W-2 wage information in hopes of generating a larger refund.

• One variation involves scammers suggesting taxpayers file Form 7202, Credits for Sick Leave and Family Leave for Certain Self-Employed Individuals, to apply for a credit based on earnings made as an employee rather than a self-employed individual. These credit dates to the pandemic period for 2020 and 2021 and can’t be accessible for 2022 tax returns.
• Another variation of this scam involves taxpayers making up fictional employees that they claim are employed in their household and using Schedule H, Household Employment Taxes. Then, taxpayers file for a refund based on false sick and family wages they never paid in the first place.

Many such scams, where taxpayers suggesting to claim huge refunds by filing the tax return electronically in hopes of getting a substantial refund.

Vigilance

The IRS reminds taxpayers that they are actively watching for this scheme and others along with the Security Summit partners in the tax industry and the states. In addition, the IRS works with payroll companies and large employers—as well as the Social Security Administration—to verify Form W-2 information.

Penalties

Falling for such scams unknowingly or deliberately for getting viral on social media will be subject to a wide range of penalties. This may include a frivolous return penalty of $5,000. Filers also run the risk of criminal prosecution for filing a false tax return.

What To Do?

Seek out tax advice from credible sources, including the IRS website, and consult trusted tax professionals. Ignore advice from viral reels and videos that sounds too good to be true. And please do not share such contents which misguides other taxpayers. For anyone who has participated in one of these schemes, there are several options that the IRS recommends. People can amend a previous tax return or consult with a trusted tax professional.

IRS Audit Group is a tax audit representation firm from Los Angeles, California. The company employs a team of certified tax lawyers who possess expertise in both state and federal tax audits. Irrespective of the client’s location, these tax professionals can evaluate your audit situation and represent you before the IRS to secure a favorable outcome for the client. Please contact us for more information. https://irsauditgroup.com/contact/

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Emergency Number: (310) 498-7508

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Taxpayers from disaster areas in most of California and parts of Alabama and Georgia now have until Oct. 16, 2023, to file various federal individual and business tax returns and make tax payments. Previously, the tax deadline was May 15, 2023, for these areas. Currently, tax relief is available to any area designated by FEMA. The current list of eligible localities and other details for each disaster is available on the Tax Relief in Disaster Situations page on IRS.gov.

Extended Tax and Payment Deadlines List

Several tax filing and payment dates that were set to begin on January 8, 2023, have been postponed by the tax relief. Below are a few of the tax reliefs that are postponed for this tax season 2023.

• Individual and business tax returns for 2022 are now due on October 16, 2023, for disaster-affected areas.
• Applicable taxpayers will have until October 16 to make 2022 contributions to their IRAs and health savings accounts.
• The expected tax payments for the fourth quarter of the tax year 2022, which have a deadline of January 17, 2023, are also postponed to October 16, 2023
• The estimated tax payments for tax season 2023, which are typically due on April 18, have been postponed until October 16, 2023.
• The deadline for filing quarterly payroll and excise tax returns, which was previously January 31, April 30, and July 31, has been extended until October 16, 2023.

Details on other returns, payments, and tax-related actions that qualify for the extended time are available on the Disaster Assistance and Emergency Relief for Individuals and Businesses page.

How to Claim the Extension?

Any taxpayer with an IRS address of record located in the disaster region will automatically receive filing and penalty relief from the IRS. Taxpayers can obtain this assistance without getting in touch with the IRS. However, if a concerned taxpayer receives a notice from the IRS about a late filing or late payment penalty with an original or extended filing, payment, or deposit due date that falls within the postponement period, the taxpayer should contact the IRS at the number on the notice to have the penalty waived.

How To Claim Casualty and Property Loss on Taxes If Impacted?

Disaster-related casualty losses incurred by individuals or businesses may be claimed on the previous tax year 2022 or the current tax year 2023. To claim on the previous tax year 2022, the taxpayers need to file it in this tax season 2023. To claim on the tax year 2023, the claimant must file it in the next tax season 2024. Losses of personal property that are not compensated by insurance or other sources of payment may also be deducted by individuals.

The IRS will assist any taxpayer whose records are located in the disaster region. If a taxpayer living outside of a disaster area and qualify for relief, call the IRS at 866-562-5227 to explain your situation, after assessment, IRS will provide the relief. This also covers employees supporting relief efforts who are connected to a reputable governmental or charitable organization.

The tax relief is based on FEMA’s local damage assessments and is part of a coordinated federal response to the harm caused by the severe storms. For more information on disaster recovery visit  DisasterAssistance.gov.

IRS Audit Group is a tax audit representation firm in Los Angeles, California. Usually, in a few cases, the IRS may ask for more information to validate the tax return filings. But rarely, IRS may like to audit your tax information through a letter of notice via Mail. In such cases, it is important to engage a tax professional like ours to represent your audit. Our licensed professionals comprise qualified CPAs and IRS Enrolled Agents. They can analyze your tax situation and help alleviate your burden. Please contact us for more information. https://irsauditgroup.com/contact/

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