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IRS Refund Audit Blog

Why your IRS refund is getting delayed? Will IRS hold the Refund if you are being Audited?

Tax season is over and now the waiting for tax refund.  Tax refund is issued when you pay more to the state government or federal government than the amount you actually owed.  Taxpayers those who over paid their taxes can expect to get tax refund.  Tax refund is not free money; it’s already paid by the taxpayers.  The IRS says that most of the tax refunds are delivered within 21 days of filing.  Tax filers can be able to track their status of the refund to know when their refund will arrive by using “Where’s My Refund?” tool at IRS.gov or by using the IRS2Go app.

If it has been more than 21 days or more than six weeks since you have filed for the tax refund, then you can contact IRS.  In certain times, IRS may hold onto your refund if you have certain outstanding debts.  Paying those outstanding debts on time will ensure that you get your entire refund on time.  According to IRS, if you use e-file or direct deposit you will get your refund faster.

What factors can delay your tax refunds?

Your tax refund may get delay for any of the following reasons.

  • The numerical errors and mistakes in your tax return can slow down the process of tax refund. This will add days or weeks to the refund processing time by the IRS
  • IRS wouldn’t be able to process your tax return, if you miss to enter any information. This incomplete tax return also will make you to wait for a long time for the tax refund
  • When someone uses your personal information to file a fraudulent tax return and claim refund in your name. In the case of tax fraud you are encouraged to contact the IRS to report the fraud
  • If you transposed a digit in your account number then the refund will be sent to the wrong account. In this cases IRS can’t compel the bank to turn over the money to you
  • If IRS thinks your tax deductions and credits are manipulated or inaccurate, refund will be hold and IRS can initiate a tax audit. You may require a professional or tax attorney to represent you in the audit.

Deadline to claim the Tax Refund

To claim any refund from the IRS you will get three years of time from the date of original deadline of your tax return.  Your refund will expire and goes away forever if you wait longer than the deadline because the statute limitations for refund claiming will be closed.  When a refund expires, the federal government will keep the money and consider it as an ‘excess collection’.  That excess money can’t be sent to the taxpayer but it can be used as a payment toward a future tax year.

It is important to research your IRS account when the IRS takes or holds your refund.  This will help you to get the reasons of the issue and clear up any confusion with the IRS.

If you are facing issues with your tax refund due to IRS audit, it is important to contact a tax lawyer to understand your rights and seek solution accordingly.  IRS Audit Group tax professionals can help you by dealing directly with the IRS to solve the tax refund issues.  Our tax professionals will review your account transcripts to complete the tax history.  Contact us 1-888-300-6670 for free consultation or email us at info@irs-audit-group.com.

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Tax free health car Plan from IRS

Tax-free Health Care Plans from IRS for 2020– Health Savings Account and Flexible Spending Arrangement – IRS Audit Group

Now it’s the time for employers to initiate discussion about 2020 healthcare plans.  Thus it is important to choose the best health care plan that suits you and your tax saving plans.  There are two types for tax-free health care plans that are provided by IRS as HSA (health savings account) and FSA (flexible spending account or arrangement).  Both have the benefits of tax savings but in different ways.

What is Health Savings Account (HSA)?

HSA plans are provided by the employers or through banks and other financial institutions, if your employer does not provide health insurance.  Therefore, both working persons and self-employed individual are eligible to contribute to HSA. HSA is not owned by the employer.  Both working and self-employed individuals need to sign in for HDHP (High Deductible Health Plan) to become eligible to contribute to HSA.  HDHP are types of health insurance plans that has low premium with high deductibles.  Many insurance companies offer such plans along with the option to open HSA.

The HSA’s contribution is eligible for tax deduction while filing for returns if you are opening the account from private insurance companies.  If your employer offers an HSA, you’d likely fund it pretax from your paycheck but it can be tax-deductibles also.  Also, the HSA contribution can be used for other investments like stocks, bonds etc.  which are also tax-free.

For the year 2020, one can contribute up to $3,550 for self-only coverage, and up to $7,100 for family coverage into an HSA.  The minimum deductible for an HDHP is $1,400 for an individual and $2,800 for a family for the year 2020.  This is an increase of $50 and $100 respectively from the year 2019.  Further, HSA dollars are carry-forwarded year-after-years if it is not spend.

What is Flexible Spending Arrangements?

This type of account is only available to the working people under an organization and not eligible for self-employed individuals.  Flexible spending is provided through employers and cannot be transferred when you leave that company.  It is not mandatory for all the employers to offer FSA.  Employers deduct the FSA contribution from the paychecks before taxes in regular increments.

IRS set the FSA contribution for the year 2020 as $2,750 which is not subject to federal income tax, Social Security tax or Medicare tax.  The FSA contribution can be used for own medical expenses, child care and dependent care.

The FSA amount cannot be rolled over to the next year plan, and hence it has to be used in the same year.  However, IRS offers two options as grace period and carry-over option.  The grace period let you to incur eligible expenses for two and half months from the end of the current year plan.  The carry-over option allows the employee to carry-over unused money with maximum of $500 to the following year.  But individuals can only available either of one option or none.

Choosing between HSA and FSA can become stressful if one does not pay attention to the real benefits both offers.  HSA seems a flexible plan but the HDHP will have high out-of-pocket limits whereas FSA have limited options.  It is important for any individual to choose the right health care plans based on the availability from your employers, your health conditions, planned amount for contribution etc.

Both HSA and FSA are subjected to IRS audit.  Therefore it is advisable to keep all the receipts that are spent using HSA and FSA money.  IRS Audit Group is the tax audit representation firm in California that defends you in front of the IRS for any tax audit disputes.  We are enrolled agents, CPAs and tax attorneys offering tax audit and state audit representation services.  Contact us for free consultation – info@irs-audit-group.com/1-888-300-6670.

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Types of IRS Tax credits

IRS Tax Credit for Individuals – What is IRS Tax Credit for Individuals and Who is eligible?

The tax owe to the IRS can be reduced using the tax credits available. These tax credits are given as a refund or it can be reduced from the tax payable to IRS.  But not all tax payers are eligible for such credits. There are different tax credits that suit every tax payers and it is important to choose the right credits wisely to avail this benefit.  Let us see the tax credits one by one below and its eligibility criteria as defined by the IRS.

Earned Income tax credit (EITC)

This type of credit is for individuals working under any organization with low to moderate income. This credit is refundable and so you may get refundable money back as a check if your credits are more than the tax you owe to the IRS. The eligibility criterion depends on qualifying children, annual income, investment income etc. The tax amount varies based on this criterion with the minimum amount being $529 to maximum of $6,431.  To eligible for EITC, one needs to keep an investment income less than or equal to $3,500. IRS has provided much simpler booklet which helps us to find the eligibility for EITC by answering few questions.

Tax Credit for individuals with kids and dependent

This type of credit is refundable and it is for the individuals with at least one or more children under the age of 17. Dependents are any person (not your spouse) as your relative who wasn’t physically or mentally able to care for him or herself. They also must meet the eligibility of annual income earned as less than $4,150 to become a dependent. The percentage of credit depends on the annual income earned by the individual who is filing for the tax i.e. more income less credit. One can get as high as $2,000 per child as credit. Each kid or the dependent should have a valid social security number issued before the tax filing due date i.e. for 2019 tax year, before Apr 15 2020 or Oct 15 2020 (if approved for tax-filing extension).   To qualify for child care credit, one must file Form 1040 or Form 1040NR, not Form 1040NR-EZ and pass all the tests which are mention in the IRS website.

Child adoption tax credits

Adoption tax credits are non-refundable, and therefore it is deducted from the tax liable based on the expenses filed but up to a maximum of $14,080. Therefore, IRS will not be sending any check if your tax liability is less than the expenses mentioned for adoption credits. But, if you are adopting a special–needs child, the full credit amount will be refunded irrespective of the expenses filed for taxes. To find out if you are eligible to file for adoption credits, take the test from IRS in this link.

Education Credits

The education credits have two types – American Opportunity Credit and Lifetime Learning Credit.

  • American Opportunity Credit – This is partially refundable credit, and applicable for each eligible student for the first four years of higher education. One can get a maximum annual credit of $2,500 per eligible student. If the partial credit amount equals the tax you owe to zero, then 40% of the remaining credit (maximum $1,000) will be refunded through checks. The students must have modified adjusted gross income less than $90,000 as single filer or $180,000 as joint filer and not have any felony drug conviction at the end of the tax year. Students must get the Form 1090-T and Tuition Statement from their educational institution for claiming through Form 8863.
  • Lifetime Learning Credit – This credit is based on the number of tax returns and not on the number of students. One can claim up to $2,000 per tax return for any eligible students who are enrolled in undergraduate, graduate and professional degree courses that are taken to acquire or improve job skills. The four years criterion (American Opportunity Credit) is forfeited as the claim is based on every tax return. One must have income less than $67,000 as a single filer or $134,000 as a joint filer. The other eligibility criteria are listed out in the IRS website

One cannot claim American Opportunity Credit if you are applying for Lifetime Learning Credit or vice versa. Also it is important to make sure you are eligible for these credits, if IRS audit your returns and found not eligible, you may be banned from getting such credits for two to ten years.

Retirement Credit

This credit is known as saver’s credit, and offers a maximum of $2,000 for making eligible contributions to your IRA (Individual Retirement Arrangements) or employer-sponsored retirement plan. These credits are based on the income from 10 to 50% of the contribution to your retirement plan. One must have an adjusted gross income less than $48,000 if he/she is the head of the household, and less than $32,000 for other filers. More information is available in the IRS website for 2019 saver’s credit eligibility and how to apply.

The IRS recommends every taxpayer to use its Interactive Tax Assistant (ITA) tools in order to find if they qualify for any of the credits. This tool also provides answers to general tax law questions and help in determine the income is taxable, documents required etc. Without proper documentations and eligibility, IRS can suspects the tax filed and conduct tax audits to verify the facts provided in the returns are correct. Therefore it is important to understand your eligibility and gather all the documents for filing.

As the tax season for 2019 is nearing, it is important for the taxpayers to make use of every credit that you qualify to fully benefit from the IRS offers.

If you have received any notice from the IRS for tax audits, don’t panic, We offer tax audit representation services with first time free consultation. Contact us:- info@irs-audit-group.com /1-888-300-6670.

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Why Not to Call the IRS Without Speaking To Our Tax Professionals

If you’ve had an experience trying to call the IRS, it’s likely you already know better than to try to call them on your own. It’s almost certain that if you try calling, you’ll be met with extremely long wait times, a confusing automated system, and perhaps even a “courtesy disconnect” where they basically hang up on you before you can ever talk to someone. If you are lucky enough to talk to someone, they’ll likely try to divert you to the IRS.gov to get the answer that you’re looking for.

Instead of calling the IRS on your own, you can have our tax professionals at IRS Audit Group call on your behalf. Authorizing a tax professional to represent you on your behalf is simple, easy, and affordable. Having one of our professionals call the IRS on your behalf is highly recommended, especially if it is a more complicated issue that you’re calling about. If you’ve received any type of notice from the IRS, for example, you do not want to stand up to the IRS on your own. Many people will often immediately call the IRS after receiving any type of letter, which typically only makes the problem worse. Our team of tax attorneys, CPAs, and enrolled agents have extensive experience in dealing with the IRS and know how to talk to IRS officials to help our clients reach a successful resolution.

Navigating through an issue with the IRS can be extremely tricky, time-consuming, and potentially even costly. Let our team at IRS Audit Group guide you through any experience with the IRS. Give us a call today at 888-300-6670 if you have any questions about a notice you’ve received, tax law questions, pending audits, or any other tax-related issue.

 

office, business, education, technology and internet concept - smiling businessman or student with computer and phone

 

Problems With Contacting the IRS Yourself

Being Discarded From the System

Now, everything is digital. Automated. Phone calls send you to a machine, or refer you to a website you barely have time to write down before the automated voice is disconnecting you. Attempting to contact the IRS is no different. You still have the likelihood of calling them only to be dismissed, and emails can so easily get lost in traffic. Overall, trying to contact the IRS is difficult, harder than it should have to be. When they hear the average citizens voice, they’re quick to dismiss, which is why having a set of reliable income tax professionals is so important in a quest to contact the IRS.

Running Into More Problems

A risk anyone takes opening themselves up to strangers is the possibility of judgement and suspicion. If you are to call the IRS, especially on account of already piquing their interest due to an inconsistency in your tax filing, they might even get you in more of a cram than you already may have found yourself in. Leave it to the tax professionals. We know how to handle these sorts of situations. It’s our job, and to try and contact the IRS on your own will only make issues more complicated than they have to be.

What We Can Do to Help

Great Representation

The IRS Audit Group is full of passionate representatives ready to work as your personalized tax representatives. We will fight for you. Having the advantage of a real tax professional service is one step in the right direction to resolving whatever IRS or tax issue you may be experiencing. Finding great help these days can be difficult, but the IRS Audit Group will only work in your favor. So, if ever you’re finding yourself looking up a great group of tax professionals near me, be sure to check out The IRS Audit Group in California.

Reliability

It’s always nice to have someone you can count on. Nobody likes a flake. And while the IRS can be a tricky bunch to grab ahold of and contact, our services make it easy to settle any pending issues or conflicts you may have with the IRS. We are a reliable service full of hardworking individuals working to do what’s best, and what’s right for YOU. There is no pride in mediocracy, and we strive to do be the best tax professionals and offer the best tax professional services there is. You can count on us no matter what the issue is. We don’t judge and we don’t hesitate. We are not afraid to be confrontational. We will fight the matter with an assertive force and ensure your conflicts with the IRS are resolved civilly.

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Get Ready, Tax Season 2018 Starts January 28th

When Does Tax Season Start?

2019 is the second year in a row that tax season, which in most years has typically started in the third week of January, will get off to a late start. A few days ago, amidst the government shutdown, the IRS announced the January 28th start date. Beginning January 28th, the IRS will accept paper and electronic tax returns.

Impact of Government Shutdown on Tax Season Dates

People throughout the nation were concerned what effect the government shutdown would have on the start day, and more importantly, on refunds. Fortunately, along with the start date, IRS Commissioner Chuck Rettig announced earlier this week that taxpayers would receive their refunds on time.  

Other Factors Impacting Income Tax Season

In spite of the government shutdown, what most experts are saying is the real cause of this delayed start is the new 1040 form that IRS officials created for this year. Taxpayers will no longer use Form 1040A or 1040EZ, but instead, everyone will complete the same Form 1040, which has six new schedules. The IRS claims most people will only need to complete Form 1040 without any of the new numbered schedules.

Important Reminders for 2019 Tax Season

Below, we highlight a few important things to keep in mind as tax season gets underway.

  1. As always, the IRS encourages people to file electronically: Whether you’re using a software or a professional tax preparer, it’s always important to file electronically to ensure you get your refund on time. In addition, filing electronically helps avoid errors that could lead to red flags.
  2. When does tax season end? Monday, April 15th is Tax Day 2019, meaning it’s the last day of tax season. You don’t have to rush to submit your tax returns right away on January 28th, but we also suggest to file before the April 15th deadline to avoid having to rush and risk making mistakes.
  3. Contact your tax preparer sooner than later: Especially given all of the new tax reforms that go into effect this year, it’s important to give your tax preparer the time to be able to review all of your documents and make sure everything gets filed correctly.

 

The tax forms 1040,1120,1065. Tax Day concept.

By making sure you follow these simple steps, you put yourself in a better position to make filing your taxes a smooth process and reduce the likelihood of an audit. In the unfortunate event of an audit, however, you can call our team of tax professionals and CPAs at IRS Audit Group to help guide you to a successful resolution. We offer full audit representation services for both IRS and state audits, as well as provide a free initial audit consultation

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What You Need to Know About the Employment Tax Audit Process – IRS Audit Group Beverly Hills

If you are facing an Employment Tax Audit from the Internal Revenue Service (IRS) then you should be prepared to provide information regarding your state employment tax obligations. The California Unemployment Insurance Code (CUIC) and the Government Code authorize the Employment Development Department (EDD) to conduct payroll tax audits of businesses operating in California. The audit ensures that benefit coverage is provided for workers who are entitled to such coverage under the law.

Typically, the EDD audit will start with an entrance interview explaining the purpose of the audit and gather general information. It is a great time to ask questions and understand the process so you know what you are facing. They may request accounting records from the last three years. By reviewing your books and records, the goal is to verify business ownership, proper classification of employees, and reports of gross/taxable wages.

You can speed up the process with compiling the following documents and providing them to the auditor:

  • Check registers, check stubs, canceled checks, and bank statements
  • General ledger and general journal
  • Annual financial statements (income and expense
    statements, balance sheet, etc.)
  • Cash payments records (pay out slips and
    vouchers)
  • Ownership verification
    • City business license
    • Board of Equalization sales tax license
    • Any license required to operate your business,
      such as a liquor license, California State
      contractor’s license, etc.
    • Written agreements (for example, Partnership
      Agreement or Articles of Incorporation)
  • Federal/State income tax returns
  • Form 1099 series, federal information returns and
    worksheets

Keep in mind that the CUIC requires employers to keep payroll records that are updated regularly and checked for accuracy. It should account for all workers (employed, laid off, on a leave of absence, or an independent contractor) and all payments made. The type of system you use should meet the needs of your business and EDD requirements.

Once they’ve reviewed initial documents and all additional information that may have been requested by the auditor – they will conduct an exit interview to discuss findings. Results may include a no change audit (in which no differences are found), an overpayment (a credit or refund may be issued), an underpayment (differences will be assessed) or both over- and under-payment. In order to appeal – you must submit a petition for a hearing before an Administrative Law Judge.

We tried to breakdown and simplify the process for you, but it is much easier with a tax professional by your side. IRS Audit Group of Beverly Hills is eager to be your designated representative during this time. We can communicate with the IRS on your behalf and reduce the stress that comes along with an audit. While the process is nerve wrecking, it can be made a breeze if you have all documents sorted and ready at all times. IRS Audit Group can assist with all of you tax needs, from filing to facing a tax audit. Give us a call to learn more and check out IRS Audit Group Newport Beach as well!

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IRS Audit Group

IRS Audit Group Newport Beach 5 Sales Tax Tips – IRS Audit Group Newport Beach

If you’re looking for sales tax help, then you have come to the right place. There are several precautions in order to safeguard your sales tax system – you should monitor the statutory rules, find ways to be efficient when collecting and be sure to remit the right sales. To develop sales and use tax system, we’ve outline some advice below:

1.Understand which products are taxable and which aren’t. Each state uses different definitions of what product belongs to which category so these may vary – utilities, personal services, business services, computer services, admissions/amusements, professional services, fabrication repair and installation are all different categories under which you may sell a product.

2. You cannot assume your sales tax process is working now because it worked before – as your business grows so will your tax obligations. Manage them correctly by adapting to compliance activities, rules and regulations.

3. Do not neglect the consumer use tax. This is a tax on tangible personal property (TPP). Remitting of this tax relies on the buyer and must be paid when businesses withdraw goods from inventory for its own use, The business must self-assess use tax that must be paid to the state and/or local tax authorities.

4. Be aware of nexus laws – your business must be registered in states where you have nexus and review related rules. Nexus, also called “sufficient physical presence,” is a legal term that refers to the requirement for companies doing business in a state to collect and pay tax on sales in that state. You might have created this presence unknowingly by contracting labor or attending conferences and trade shows out of your region.

5. Automate as much of the system as possible. Inventory management, sales and finance automation can give you much more flexibility when handling the sales tax process. It is also much more efficient for growing businesses who are trying to balance time and money.

If you have negative audit findings or have paid fees for sales tax-related issues then you should contact our team at IRS Audit Group Newport Beach today! We can guide you to the best practices for addressing sales and use tax compliance. IRS Audit Group is a premier IRS tax resolution firm that strives to achieve results that exceed expectations through our commitment to our clients. Our tax attorneys handle all complex and sophisticated matters locally and nationally.

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IRS Audit

Why You Should Choose IRS Audit Group of Beverly Hills

With the variety of tax preparers available at your service, choosing the right one is the essential step to financial stability. Thankfully, the IRS Audit Group of Beverly Hills includes certified public accountants, enrolled agents, and tax attorneys who are eager to provide professional tax service. We work with the Internal Revenue Service (IRS) on your behalf and handle all communications necessary to resolve any issues.

We want to make you feel comfortable, you are sharing a lot of personal information with us after all … from your income, family and work life and social security number. We don’t take this responsibility lightly. At IRS Audit Group in Beverly Hills, CA we strive to develop a long-term relationship so you can count on us to do more than just crunch numbers. IRS Audit Group is honest, reliable and capable of handling everything from individual returns to complicated tax disputes and corporate matters.

As professionals, we welcome your questions – we offer a free consultation to help get initial concerns out on the table prior to working on your account. Our firm is committed to helping taxpayers and relieving their stresses over taxes. Whether you found us through a simple “IRS Audit Group Beverly Hills” search or asked around for referrals, we guarantee the same great service to each of our clients.

With a variety of services that help you understand tax processes and avoid confusion, we are experts at handling event the most frustrating issues with the IRS. While we specialize in audits, there is nothing we can’t handle – from avoiding problems in the future to finally putting ongoing ones to rest.

We have over a decade worth of experience, here at IRS Audit Group, closing countless cases from tax preparations to audits and everything in between. It is hard to beat our level of skill, education and expertise. Give us a call or visit our office in Beverly Hills for a consultation. We look forward to hearing from you and helping you out of a difficult situation.

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IAG Tax Season

Upcoming Tax Extension Deadlines – Friendly Reminder From IRS Audit Group

If you are one of the many taxpayers who requested an extension from the Internal Revenue Service (IRS) on filing their taxes earlier this year then your time is almost up. A filing extension is an exemption made to both individual taxpayers and businesses that are unable to file a tax return by the due date (approx. every April 15th). Individuals must have completed and filed IRS Form 4868 by the regular date of their return, however, for an automatic six-month extension.

If you filed your return over 60 days after the due date or extended due date, the minimum penalty is about $135 or 100 percent of the unpaid tax. If you can show reasonable cause, you don’t have to pay a late-filing or late-payment penalty. In case you don’t have it highlighted on your calendar, we’re here to remind you of the following tax extension deadlines:

September 17, 2018

  • Third-quarter estimated tax payments due for 2017.
  • Final extension deadline to file S-corporation tax returns for 2017 (Forms 1120, 1120A, 1120S)

October 15, 2018*

  • Final deadline to file individual tax returns for 2017 (Forms 1040, 1040A, 1040EZ).
  • Final deadline to file C-Corporation tax returns for 2017.
  • Final deadline to partnership tax returns for 2017.

*Keep in mind that after Oct. 15, the IRS will no longer accept an electronically filed tax return. After this deadline, you must mail in your tax return in order for it to be processed.

We are hoping this gives you enough advance notice so you can get started on necessary preparation to meet these deadlines, don’t panic if you missed any of them or aren’t on track to get everything in order by then … simply contact our team at IRS Audit Group for immediate assistance. Schedule a free consultation to review your documents and determine the quickest solution to be sure you take action and resolve any outstanding matters.

While your chances of going to jail or facing an audit are slim, the IRS always prefers immediate action, whether you haven’t filed yet or still owe taxes. You may face financial penalties, however, including interest, but this can all be taken care of with an installment agreement. So if you’re worried about paying a lump sum in one sitting, the IRS offers alternative options that work for your budget, as long as you qualify.

Contact us if you are having any other issues with the IRS. We can help with countless services that involve tax problems throughout the country. With offices in Newport Beach and Beverly Hills, IRS Audit Group professionals are knowledgeable and experienced in assisting those who need additional guidance when filing taxes.

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How to Manage State Tax Audit and Pay Right Amount – IRS Audit Group California

State Tax Audit

You feel like you are out of your mind when you’re busy at work and you got an email for tax audit.  Or a stone-faced man with a dark suit and a big briefcase appears in the doorway.  This is a terrible situation you exactly don’t have receipts for everything.  Instead of facing California State Tax Audit solo, hire a private audit expert like IRS Audit Group California for your help, they can guide you step by step how to recover yourself from California State tax audit.

The reality is that companies in California get audited for any number of reasons, but it’s valid to wonder what makes some businesses more likely to be audited than others?

What can business owners do to prevent a California State Tax Audit?

The following list identifies key activities the IRS actively looks for and outlines some ways your business can prevent an examination:

#1: Keep Personal and Business Expenses Separate

 Entrepreneurs attest that there’s a level of uncertainty when drawing the line between expenses, tax law where the IRS aggressively enforces that all business owners keep business and personal spending separate.  Even if you’re startup it’s essential to split up business expenses and personal expenses.

#2: Provide Proper Documentation for Tax Credits

 While providing documents for the tax credit you may need the help of a tax audit experts like IRS Audit Group California to claim tax credits, as claiming tax credits is a detailed process involving meticulous record keeping and complex calculations.

This is one more reason to have a certified tax professional (IRS Audit Group California) on your side.  Even if you are 100% eligible for these credits, calculating the actual reduction to your tax liability can be tricky.  The IRS is used to finding errors in calculations, making them likely to scrutinize each claim even more thoroughly.

 

#3: File Your Payroll Tax Returns:

The IRS is particularly harsh in enforcing fines for late payroll tax reporting.

You must file payroll tax returns for all compensation to employees.  The amount reported as your total compensation expense for income tax returns should then match the amount reported for the payroll tax.  Consultants like IRS Audit Group California help you in this regard.

#4: Follow the Filing Rules in Every Place You Do Business

If your business (property, payroll, or sales) has a presence in a state, you should look at the filing requirements for that state.

While 100% of your income is included on your federal return, if you have sales, locations, or employees in multiple states, apportionment of your income is required to determine your liability in each one.

#5: File forms 5471 or 5472 for foreign business

 If your business has foreign activities or shareholders, you should be aware of the required forms based on your type of business (forms 5471 or 5472).  Failing to file or filing late can result in a $10,000 penalty perform, per year! IRS Audit Group California provides service in this regard.

#6: Make Charitable Contributions in Cash Instead of Property

The IRS requires proof for most charitable donations, whether in the form of cash or property.  While cash donations are easily documented by a check or receipt; non-cash items like furniture or equipment require documentation of fair market value and tax basis.

#7: Proofread, proofread, proofread

 Be careful about wrong or missing social security numbers, math mistakes, errors in figuring credits or deductions and forms that are not signed or dated.

If your business does get audited.  Remain calm and don’t forget to hire external tax audit professionals like IRS Audit Group California, as claiming your own tax audit by own is a kind of invite the tax audit to your home.  The reality of being audited is that it happens to the best of us and it does not need to mean the end of your business.

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IRS Audit Group

Tax attorney in Beverly Hills, California

468 N Camden Dr #200,
Beverly Hills, CA 90210, USA

Call: +1 888-300-6670

Hours

Sunday8:00am-5:00pm Monday8:00am-10:00pm Tuesday8:00am-10:00pm Wednesday8:00am-10:00pm Thursday8:00am-10:00pm Friday8:00am-10:00pm Saturday8:00am-10:00pm