Continuing on last week's topic on tips for dealing with an IRS audit and avoiding penalties, it is important to be up front about any errors you may have made. For example, if you entered $10,000 instead of $1,000 for a line item, just own up to it as it will save time as well as demonstrate your integrity. Another tip is to locate the original receipts for any assets in which you are showing any depreciation for, even if the purchase of an asset goes back more than three years. The IRS can request purchase documentation for any asset on your schedule for depreciation.
It is that time of year again when people start contemplating filing their tax returns and wondering, perhaps how to respond to an Internal Revenue Service audit and avoid penalties, should an audit be requested. If you are facing an audit of your California business taxes and after reviewing your returns see that you did indeed make a few mistakes, should you just file an amended return and skip the audit?
It is that time of year again when Alameda residents and others around the country begin to think about preparing and filing income tax returns. With tax laws constantly in flux these days it can be a good idea for many who do not normally enlist the services of a professional tax preparer to consider doing so this year. As previously reported, the fiscal cliff has resulted in a number of changes to tax law that could affect many.
True or false: nothing is certain in life other than death and taxes. Apparently the answer may be false for churches, synagogues and other religious institutions in San Francisco and across America. It may be false because the Internal Revenue Service has not been auditing religious institutions since 2009.
Virtually everyone must pay some sort of taxes. For a sole proprietor, small business owner or other business with employees, one of the types of taxes which must be withheld and paid for employees is the payroll tax. The Internal Revenue Service does not look favorably upon unpaid payroll taxes. Or does it?
Many of us in California have different types of investments, some of which are designed to minimize our tax liability. One of those is a tax-exempt bond. According to the Small Business Administration tax-exempt bonds are basically loans to a private business that are issued by the state or a local government. They are then re-sold on the open market. Interest income earned by the new bond owner, is exempt from state and local taxes, so the lender can pass those savings along in terms of lower interest rates.
In uncertain economic times, a business may hire independent contractors to perform certain jobs. The benefit to the company is that the work gets done, and the company is not committed to a long-term relationship with the worker. There are no benefits to be paid, and the worker can come and go as the need arises.
Many people in California may be unaware of all of the tools that the Internal Revenue Service has at its disposal. If you are an individual, sole proprietor or business owner, you may one day have the first-hand experience of opening a letter from the IRS in which they request more information about a tax return.
As we enter the fall election cycle, California and the rest of the nation is talking about the economy, employment and taxes. Recently the Treasury Department released information that affects all three of those contentious topics.
It is difficult to imagine the frustration that must have been felt by a Sacramento couple as they tried to do something good, and were slapped on the hands for their efforts.