The Section 501(c)(3) Internal Revenue Code specifies that any Tax-exempt organizations need to be organized and operated exclusively for exempt purposes. Also, it needs to ensure that none of its earnings inure to any private shareholder or individual.  In this context, the private inurement means that the assets of the organization must not be used to benefit a single person excessively.

Here are a few types of Exempt Organizations.

• Charitable Organizations
• Churches and Religious Organizations
• Private Foundations
• Political Organizations
• Other Non-profits

  The IRS requires most tax-exempt organizations to file annual tax returns. Even though most tax-exempt non-profit organizations do not pay federal taxes, these entities are required to file an informational return with the IRS.  Hence, such entities need to file their IRS return for this tax season 2022.

 The annual reporting return for tax-exempt organizations is referred to as a Form 990. Most of the tax-exempt organizations need to file an annual return, and it can be done electronically. The financial activity of an organization determines which form it must file, as shown in the chart below.

 The deadline for the tax season 2022 has been fixed as May 16 to file IRS return by the tax-exempt organizations. Taxpayers who need more time to file beyond the May 16 deadline can request Form 8868 which is the Application for Extension of Time to File an Exempt Organization Return. This form will provide a 6-month automatic extension. Extending the time to file a return does not extend the deadline to pay tax in circumstances where tax is payable. Organizations requesting an extension are encouraged to complete Form 8868 electronically, according to the IRS.

Extended Support From IRS

IRS helps taxpayers, board members, volunteers, and officers in filling returns to comply with their tax filing obligations. Therefore, it lists few modernized e-File (MeF) providers who have passed the IRS Assurance Testing System (ATS) requirements for Software Developers of electronic Exempt Organizations. The list of such service providers can be found using the below IRS webpage

https://www.irs.gov/charities-non-profits/tax-year-2021-exempt-organizations-modernized-e-file-mef-providers

IRS Audit Group is a Tax Audit Representation firm in Los Angeles, California. We are a team of tax attorneys having hands-on experience in dealing with IRS audit process. We help you file your tax return for 2022 complying with all obligations and represent you on IRS audit. Contact us to get free consultation to understand your issues. https://irsauditgroup.com/contact/

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Email address: info@irs-audit-group.com

Qualified Opportunity Fund (QOF) is an investment vehicle formed as a company or partnership with the goal of investing in property within Qualified Opportunity Zones. This program was formed per the 2017 Tax Cuts and Jobs Act to provide a tax incentive for private, long-term investment in economically distressed communities. There are thousands of low-income communities in all 50 states, the District of Columbia and five U.S. territories that are designated as Qualified Opportunity Zones. Taxpayers can invest in these zones through Qualified Opportunity Funds. This type of opportunity funds assists taxpayers in giving tax advantages and rewards to investors.

Certain types of businesses cannot be included in opportunity funds, even if it falls within opportunity zones. Following are types of business which are not included in opportunity funds.

• Golf courses
• Country clubs
• Massage parlors
• Hot tub facilities
• Suntan facilities
• Racetracks or other facilities used for gambling
• Liquor stores

Eligibility Criteria

To certify and maintain a Qualified Opportunity Fund, an entity must:

• Be a partnership, corporation, or LLC that is treated as a partnership or corporation, and it must have filed a federal income tax return;
• Be organized for the purpose of investing in Qualified Opportunity Zone property under the laws in one of the 50 states, the District of Columbia, a U.S. possession, or a federally recognized Indian tribal government: and
• Hold 90% of its assets in Qualified Opportunity Zone property.

IRS Form Required to Certify as a Qualified Opportunity Fund

The entity must file Form 8996, QOF, with the qualifying partnership or corporation’s federal tax return each year to attest and retain its status as a Qualified Opportunity Fund. The entity must file Form 8996 by the due date for 2022 tax return (including extensions).

Form 8996 is used to:

• Certify the corporation or partnership is organized to invest in Qualified Opportunity Zone property.
• Report that it meets the 90% investment standard of section 1400Z-2.
• Figure the penalty if it fails to meet the 90% investment standard.

Benefits to the Taxpayers

The QOF basically provides tax deferral to the capital gains if the taxpayer elects to do so. The basis in the QOF investment becomes zero when one elect to defer the gain. The longer the investment in the QOF, the higher the basis grows. The tax benefit received is determined by the length of time one retains the Qualified Opportunity Fund investment. For instance

• After five years, a taxpayer who defers gains through a Qualified Opportunity Fund investment obtains a 10% step-up in tax basis
• It will be followed by another 5% step-up after seven years. Note that the taxpayer must have invested before December 31, 2019, to receive the entire 15% step-up in tax base. The taxpayer will have held the investment in the fund for seven years when the tax is triggered at the end of 2026, thereby qualifying for the 15% increase in tax basis.
• If the taxpayer holds the investment in the QOF for at least 10 years, then such taxpayer may be able to permanently exclude gain resulting from a qualifying investment when it is sold or exchanged.

A team of tax attorneys from IRS Audit Groups helps taxpayers in filling their IRS return for 2022. We are certified tax lawyers who represent taxpayers during any IRS audit. We can resolve common tax problems to complex audit sessions to help comply our clients. Get free consultation by calling or filling the enquiry from our website below

https://irsauditgroup.com/contact/

Telephone Number: (310) 498-7508

Email address: info@irs-audit-group.com

What is FBAR?

According to the Bank Secrecy Act, one must declare and keep records of certain foreign financial accounts, such as bank accounts, brokerage accounts, and mutual funds, to the Treasury Department every year. The accounts are reported on a Financial Crimes Enforcement Network (FinCEN) Form 114 called a Report of Foreign Bank and Financial Accounts (FBAR). The annual due date for filing FBARs for foreign financial accounts is April 15^th of every year.

Who must file FBAR?

A citizen, resident, corporation, partnership, limited liability company, trust, or estate in the United States must file an FBAR to report if they have a financial interest in or signature or other authority over at least one financial account located outside the United States and its aggregate value of those foreign financial accounts exceeded $10,000 at any time during the calendar year reported.

However, you are exempt from reporting foreign financial accounts if they are:

• Correspondent/Nostro accounts
• Owned by a governmental entity
• Owned by an international financial institution
• Maintained a U.S. military banking facility,
• Held in an individual retirement account (IRA) of which you’re an owner or beneficiary,
• Held in a retirement plan of which you’re a participant or beneficiary, or
• Part of a trust of which you’re a beneficiary,  if a U.S. person (trust, trustee of the trust or agent of the trust) files an FBAR reporting these accounts.

Further taxpayers don’t have to file an FBAR for the tax year 2022 if you meet the following criteria:

• All your foreign financial accounts are reported on a consolidated FBAR, or
• You jointly own all your foreign financial accounts with your spouse and:
  • You completed and signed FinCEN Form 114a authorizing your spouse to file on your behalf, and your spouse reports the jointly owned accounts on a timely-filed signed FBAR.

Note: Your eligibility for this exception is unaffected by your filing status, such as married-filing-jointly or married-filing-separately.

How to file the FBAR?

The FBAR must be filed online using FinCEN’s (Financial Crimes Enforcement Network) BSA E-Filing System. The FBAR is not filed with the federal tax return. You need to call FinCEN’s Resource Centre to request an exemption from e-filing if you want to file your FBAR on paper. If FinCEN authorises your request, you will get a printed FBAR form to fill out and mail to the IRS.

If you wish someone else to file your FBAR on your behalf, fill out FinCEN Report 114a, Record of Authorization to Electronically File FBARs, and provide it to them. FinCEN Report 114a is not submitted with the FBAR; instead, retain it for your records and make it available to FinCEN or the IRS upon request.

Deadline to file for the Tax year 2021

The FBAR is an annual report that is due on April 15 of the year reported. If taxpayers miss the FBAR annual due date of April 15, they will get an automatic extension until October 15. To file the FBAR, you do not need to request an extension.

More information related FBAR filing and other resources available on the IRS website here – https://www.irs.gov/businesses/small-businesses-self-employed/report-of-foreign-bank-and-financial-accounts-fbar

IRS Audit Group are a team of Tax Professionals, CPAs, Enrolled Agents and Tax Attorneys, primarily specializing in Internal Revenue Services (IRS) Tax Audit Representation. We resolve your tax audit issues and represent on behalf of you to the IRS. Call us to get free consultation from our tax professional to understand our Tax audit concerns.

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Getting an audit notice from the state department of taxation used to be a scary experience. The IRS isn’t the only government agency that can send you a notice about your taxes. Agencies such as the California State Tax Audit, and the Board of Equalization can also inquire about the taxes you filed. The law places the burden on you to demonstrate that your state income tax return information is correct.

It is always unpredictable when it comes to getting an audit notice or an examination by the IRS. However, plenty of help is available by contacting experienced tax relief attorney like IRS Audit Group Beverly Hills to deal with the taxation authorities on your behalf.

How the State Taxation determines and What State Taxation Authority looking for in a Tax Audit?

State Income tax audits are done primarily as office audits. State taxation authorities use tax audits to determine if you properly reported your income, deductions, exemptions, and credits in your income tax filing. They may request you to provide supporting records in person, on phone, or by mail to prove that your filing is correct.

Auditors cross-match state and federal return data verify that all income reported on information returns has been included on the state return, that deductions taken on the state return are valid, adjust based on audits conducted by the Internal Revenue Service, and conduct domicile investigations.

State Tax Audit Defence Lawyer from IRS Audit Group Beverly Hills
Being selected for a state tax audit is not necessarily an indication of any tax fraud. Even if you don’t have any unfiled tax returns, and are certain that all information you have provided to the state taxation authority is correct, still you may get audited. The state tax auditor seeks to uncover honest record-keeping mistakes, as well as possible tax fraud. It is important to understand that any information you provide to the state tax examiner can and will be used against you.

It is always a good idea to be represented by a tax lawyer provided by from IRS Audit Group Beverly Hills, who understands how to deal with the state taxation authorities in a tax audit.
As an experienced tax attorney from IRS Audit Group, Beverly Hills will explain the standard procedure in a state tax and also elaborate their process to verify the accuracy of a taxpayer’s returns.

Hence, protect your rights by being represented by a tax attorney from IRS Audit Group Beverly Hills, who understands your situation, as well as state and federal tax code. The first and the best thing you can do in the event of a state tax audit is to invoke your right to legal counsel before answering any questions or providing any documentation regarding your case.

What Happens if the State Tax Auditor Uncovers Items which you Cannot Substantiate?
Even if the state tax auditor determines that you owe back taxes (plus any interest payments or penalties that may have accrued), there are several avenues that your tax attorney from IRS Audit Group Beverly Hills can help you. Depending on the situation, your attorney can help you to set up a tax payment plan, negotiate an offer in compromise, seek a penalty abatement or currently not collectible status, or file a state tax appeal.

If you have received notice of examination or documentation from the state taxation authority informing you of your rights during the state appeals process, you should act quickly to obtain legal tax representation. Contact RS Audit Group Beverly Hills California for a free initial consultation today at (310) 498-7508.