As the Tax season for 2021 is nearing, it is good to have a basic understanding of the recent adjustments in tax structure, exemptions, and credits.  Such info will help taxpayers to plan and file tax returns in time.  Every year, the Internal Revenue Service (IRS) updates tax rates, rebates and thresholds that are adjusted with the annual inflation. On Nov. 10, 2021, the IRS announced inflation adjustments for 2022 affecting standard deductions, tax brackets, and more.

Thus, the Tax Filing Year 2022 got many updates that are listed in detail by IRS in this document. It is important to discuss a few such changes that need spotlight among every taxpayers which are listed below.

1. Child Credit on Monthly Basis

Child Tax Credit provides financial benefits to those with qualifying kids. For those Tax Years before 2021, the IRS allowed claim up to $2,000 per child under the age of 17 in Tax Filing.  However, during the Tax Year 2021, the following changes were done.

• Child tax credit amount has increased up to $3,600 per child under 6
• Child tax credit amount has increased up to $3,000 per child ages 6 to 17
• Child tax credit is now fully refundable.
• Child tax credit has been converted to monthly payment

As the COVID-19 has negatively impacted the country’s economy and the taxpayers, the IRS provided 50% of the child tax credit as advance monthly payments during the period July to December 2021. Tax filers may need to repay if they received more than the eligible pay.  Similarly, those who received lesser credit can file and claim back. Thus, the expanded child tax credit payments could impact many families’ tax refunds. For more specific details, please be guided by the IRS government portal

https://www.irs.gov/credits-deductions/advance-child-tax-credit-payments-in-2021

2. Recovery Rebate Tax Credit

Recovery Rebate Tax Credit or Stimulus Payment is another benefit in case you haven’t received the third economic impact payment while preparing Tax Filing. Those who lost jobs or whose income drastically decreased in 2021 can now claim the Recovery Rebate Tax Credit. Here are the eligibility criteria to receive the economic impact payment.

• You’re not dependent of a taxpayer
• Your adjusted gross income (AGI) can’t exceed:
• $150,000 for married filing jointly
• $112,500 for heads of household
• $75,000 for single filers

One must file 2021 Tax Return to receive the Recovery Rebate Tax Credit even if not done Tax Filing or any tax return in the past. You can use any one of IRS’ Free File Providers from the list given.

Note: You must have AGI of less than $73,000 to use the IRS’ free file program.

Learn more from IRS official website below

https://www.irs.gov/coronavirus/economic-impact-payment-information-center

3. Claim Charitable Donations

For the Tax Year 2021 Tax filing, the claims on Charitable Donations are changed with the increase in tax deductions. Taxpayers both individuals who itemized and those who do not itemize can avail such benefits of these deductions while filing the return.  Now, the tax filers can deduct up to $300 for cash donations to qualifying charities (up to $600 combined for married filers) whether you itemize or take the standard deduction for 2021.

Those who claim charitable contributions as itemized deductions can claim cash contributions made to qualifying organizations up to 100% of their adjusted gross income (AGI) for the 2021 tax year only. Such deductions used to be limited to 60% of the taxpayer’s AGI. More specific info can be found at https://www.irs.gov/about-irs/the-irs-encourages-taxpayers-to-consider-charitable-contributions

IRS Audit Group continues to monitor the tax provision updates every year and highlights important changes that benefit the taxpayers in Tax Filing. We are certified tax lawyers having immense experience in state and federal tax laws. Get a free consultation with us to understand your tax problems and help you deal with IRS on this upcoming Tax season 2022. Telephone Number: (310) 498-7508 (or) info@irs-audit-group.com

To deal with budget shortfalls, state governments revenue agencies continue stepping up their efforts in raising revenue through sales tax audits.

You never ask for it, but you have been selected for and will be notified of a sales tax audit. At that point in time you may get confused – What should you do and what you should not? Most companies are not regularly audited by the state for sales and use tax purposes, so it is unlikely you have previously handled an audit. While the requested lists of records and documents that will be reviewed appear straightforward, there is much more to handling a sales tax audit. There are a lot of potential pitfalls during the interaction with auditors that may occur as you address the questions they typically ask.

Here are a few tips to Manage Your Sales and Use Tax Audit from IRS Audit Group Newport Beach. The best practices as listed below need to be considered in such situation.

Hire an external representative tax expert. IRS Audit Group Newport Beach has a pool of experts specializing in State Sales Tax matter. Once you are identified for audit, it is better to initiate communication with experts. They can discuss the audit process with you, provide some background on various sampling methods, and provide insights on specific industry issues targeted by the state. Also, make them aware of the initial schedules vs. revised schedules.
Ask your tax expert from if it is appropriate to perform a refund study or reverse audit at the same time to identify potential opportunities for refunds. IRS Audit Group Newport Beach can provide immediate solutions to such questions.
Do not engage in contingent fee arrangements on questioned items by the auditor unless you have already made the first pass. Otherwise, you may be paying them on reductions for errors made by the auditor or obvious exempt transactions.
If sales state tax auditors are doing a refund study/reverse audit, their fee should not be based on savings in periods outside the audit period. Their fee should always be based on offsets actually granted by the state. Payment should be made at the end of the audit, or a provision should be included to reverse any offsets not allowed.
A sales tax audit is not an ordinary occurrence. Therefore, you need to invest the proper efforts internally or with external assistance from experts like IRS Audit Group Newport Beach.

Lastly, be ready to play defence. Do not assume all questioned sales and purchases are taxable. Familiarize yourself with the regulations of your state with the help of expert advice from IRS Audit Group Newport Beach. Once you are convinced that questioned item should not be assessed, go ahead and challenge it. Also, understand any sampling techniques employed by the auditor, and be sure samples used are representative of your operations. If you have not experienced a sales tax audit before, and unfamiliar with your state’s regulations, or you have identified significant problem areas in your self-review, you may want to consider engaging a tax advisor to assist in your defence.

IRS Audit Group Newport Beach professionals are knowledgeable and experienced in assisting companies undergoing state sales and use tax audits as well as conducting overpayment reviews. Let IRS Audit Group Newport Beach help you navigate the audit landscape.

Telephone Number: (310) 498-7508
info@irs-audit-group.com

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.

If you’ve requested a six-month extension to submit your taxes then your deadline is coming up quick! October 16, 2017 is the last day to file your individual or corporation return. This includes the 1040, 1040A and 1040EZ or 1120 tax forms. Beware of penalties for late payments or filing.

Don’t let this extra time go to waste. Be sure that you file your return immediately and see if you qualify for common credits and deductions. Low and moderate income families may be eligible for special tax benefits as well.

According to the IRS, you could also receive credit if you’ve paid college tuition or fees in the last year. Same goes for those that have made their homes energy efficient.

E-filing will reveal guides and tips to help you complete your return, but you can also call us for a one-on-one consultation with a tax professional. If you’ve missed important deadlines in the past or fear you won’t get the paperwork done in time for the upcoming deadline please give IRS Audit Group a call to learn how we can help resolve your tax issues ASAP.

Telephone Number: (310) 498-7508
info@irs-audit-group.com