Archive for the ‘Tax’ Category
Posted on April 2, 2010 - by admin
No one wants a Tax Audit
Being audited is a scary thought but there are things you can do to minimize your chances of having one. An audit is when an IRS agent contacts you to verify information on your filed tax return. Sometimes it is a matter of your math being wrong, it you were the one who prepared your return. So making sure all your t’s are crossed and there is no missing details, you will better you chances of not getting this call.
If you claim a charity donation on your return, you better have the receipt to back it up. If you donated your car or claimed to have given more than ten percent of your income, then you should have proof because these things put up red flags to the IRS.
Travel and entertainment expenses will also raise a flag so keep records of things like this and the reason for that trip you took. If entertainment is part of your life, then keep track of who and where and how much you paid. Having this documentation won’t stop an audit from coming your way, but you can prove your case if you must. The IRS will randomly choose people to audit so don’t panic if you get a call. You will only be asked to prove your claims made on your return.
Posted on April 2, 2010 - by admin
Tax Time Questions
Always, at tax time, people have more questions than answers. One common question that many CPAs get each year is how can I lower my tax bill? It is recommended that you participate in a 401k where you work or start a IRA but sit and talk with your CPA as this is the person who can point out deductions that you don’t know about.
What type of information is needed at tax time? At the very least you will need your W-2 form from your employer and anything else that documents you income. This could be a 1099 and you will also need your mortgage records and property taxes. Also have with you receipts for items that that you will deduct like business expense reimbursements. Maybe you are ready on time, then what? It is possible to get a six month extension on your return but you still need to estimate if you own and mail that by April 15th.
If you are unable to pay what you owe, you could be subject to a penalty and interest charges but you can ask for a monthly installment arrangement and this can be done by filing a form 9465 and must be done within thirty days, and that is if you plan is accepted by the Internal Revenue Service.
