Tax Secrets

Five Tax Secrets to Avoid IRS Difficulties

We are experienced with many types of businesses and industries. There are a lot of highly successful business people making a lot of money, but there are also businesses that are making no money at all. One big problem unsuccessful businesses have in common is IRS difficulties.  We are very effective in helping businesses end their IRS problems and avoid them in the future. Read the following FIVE TAX SECRETS and contact us now. You owe it to yourself to take action and rid yourself of all IRS problems.

1. File All IRS Required Tax Returns On Time
Most people don’t realize that the IRS charges a penalty of up to 25% just for filing your tax return late. That’s right, 25% of what you owe. This includes Individual Tax Returns, payroll tax returns and corporate tax returns.

The fact is you can file ANY tax return on time and avoid the 25% penalty, even if you don’t send in the money that is owed on the tax return. You’ll still hear from the IRS for not sending the money owed, but you will avoid a 25% penalty.

2. Don’t Pay IRS Penalties
The IRS has more than 148 types of penalties. These can add up, because the IRS also charges interest and additional penalties on the original penalty.  You can request that the IRS “abate your penalties”. Before you pay the bill, you ask to get the penalties reduced or completely abated to zero. We can help determine when and where to make your request, depending on the types of penalties assessed. We have succeeded on many occasions in getting penalties abated, saving our clients thousands and thousands of dollars.

3. Pay Your Payroll Taxes On Time
Sometimes businesses get behind on payroll taxes due to cash flow problems. The IRS takes a very serious approach to collecting delinquent payroll taxes, and may levy or seize company assets very quickly. In addition, the penalties and interest assessed by the IRS are excessive for this type of delinquency.

Each of the check signers listed on the bank signature card may be held personally responsible for the payroll taxes. Before the company gets into the danger zone, all non-essential check signers should be deleted from the bank signature card.

If you are a check signer on the company checking account, it is your responsibility to make sure all payroll taxes are paid at least monthly to the IRS.

4. Avoid IRS Audits and if you get audited, hire a professional.  Nothing ever good comes out of  direct contact with an IRS Agent.
You can avoid IRS tax audits by following these simple guidelines:

  • File your tax return on time
  • Report all income for which you received 1099 or W-2 forms
  • Avoid Schedule C
  • Set up some type of record keeping
  • Don’t make your tax return look absurd (or be an outlier)

Most of the people who get audited are self-employed and use Schedule C to report income and losses from their business. These forms often cause all sorts of red flags at the IRS.

Your entire tax return must look reasonable. This includes filing status, dependents, and most importantly, expenses in relation to income. Avoid adding errors, deductions on the wrong lines, wrong forms, missing forms, and messy hand-written forms.

If you receive an IRS audit letter, you don’t have to go. You don’t even have to talk to the auditor. The Taxpayer Bill of Rights allows you to be represented by an attorney or accountant who can answer questions for you and provide documentation to the IRS. We strongly recommend this approach. The best way to end an IRS audit with a great outcome is to provide them the information they request and don’t let it become prolonged.

5. Don’t Pay The IRS; Cut A Deal
The IRS may cut a deal on taxes owing, including all penalties and interest if you qualify. The requirements are rigid; however, it is in their best interest to get you back in the system as a current taxpayer and to collect on old taxes owing.

The fine print requires you to file your tax returns and pay on time for the next five years. If you don’t, the IRS then revokes the deal and bills you for the original amount, plus interest and penalties.

Many of our “offers in compromise” presented to the IRS on your behalf are accepted. Let Taxman and Associates assist you. We have extensive IRS experience and are familiar with all of its inner workings. You owe it to yourself to take action and rid yourself of all IRS problems.