Don’t go into a battle improperly armed. In your ongoing attempt to pay the legally lowest amount of your hard-earned dollars to the internal revenue service (IRS), the labyrinth-like federal tax code can trip you up. Do yourself a favor if you are concerned about running afoul of the IRS and get competent tax consulting Bronx NY.
THE IRS: World’s Largest Collections Agency
The IRS is the largest collection agency in the United States. It is federally funded at the rate of over $10 billion each year, abundantly staffed with over 89,000 employees, and aggressive when it wants to be. Every year it collects more than $2.4 trillion. Still, it believes that is still owed hundreds of millions of dollars every tax year. If you receive a 1099 and don’t report that income, the IRS will eventually catch up with you.
Even if you are completely honest, mistakes on your return can be made. Mistakes often happen when people prepare and file their personal or business tax returns by themselves. Believe it or not, these mistakes account for a great many of the audits conducted by the IRS.
Some Facts About IRS Audits
Although the thought of an IRS audit can put fear into your mind, your best bet is to get professional help and make sure you are honest in your reporting. Here are some facts about IRS audits that may help ally fears:
- Less than 1% of all federal returns are audited
- The biggest triggers for an audit are math errors on the return
- Even if you are audited, you are unlikely to interact with a live federal auditor
- In some cases, an audit can net you a refund on money instead of a penaly
Make sure you keep good records. They will make working with a professional much less time consuming and less likely to produce inferior returns.