The beginning of each year is a stressful one for tax paying citizens because it’s tax season. W-2s may have come in late, you can’t find all of your receipts and you don’t know how much you donated to your various charities this year. No matter what your reason for all the stress during tax season, you are not alone. Thousands of people are right there with you, wishing that they had the help of a tax attorney.
There are many common problems that people have with the IRS, problems that are no more than worries when it really comes down to it. Some people filing taxes may legitimately need a tax attorney to help lower fines, get rid of liens or even help you get through an audit. Having a good tax attorney can sometimes mean that you won’t have to deal with some of the tax issues that other suffer through because they have headed them off. Here are some of the most common tax problems with the IRS that people have.
Many people are fearful of an audit. Whether it is because they didn’t keep all of their receipts and W-2s together and are fearful of not finding these documents when they need them, or they do not claim legitimate tax deductions in hopes of keeping the IRS away from their door, the end result is that they do nothing more than pay more taxes than was necessary because they were afraid to claim everything that they could.
If you are truly concerned about being audited, take your taxes to an accountant or a reputable tax preparer so that you have someone to back you up when you feel that some of your larger deductions might be questionable. Having someone do your taxes for you lifts a pressure off your shoulders that you may not have known that you were carrying.
People that have not filed taxes in a long time sometimes fear that they will not be able to pay all of their taxes by April fifteenth. This leads them down a path of not filing or non-payment and increased penalties and interest being added to the monies that they already owe. You can get an extension to pay your taxes if you feel that you will not be able to make the tax deadline. Each year thirteen million Americans face penalties for failure to pay their taxes on time. When this happens, interest is added to the total of the unpaid bill making the situation nearly impossible.
The IRS would much rather see that you file an extension to pay the tax instead of having to go on a search to force you to pay it. Tax evasion is serious business that nobody wants to mess with.
Be aware that one of the most common things that people fail to respond to is computer notices of taxes due or other information from the IRS. This is often because they feel that these notices are a fake. It is true that thousands of fraudulent emails and computer notices are sent out each year on behalf of the Internal Revenue Service, but at the same time, the IRS sends out tens of millions of emails each year to tax paying citizens. The best thing to do is to respond in writing and inquire about whether or not the IRS really is the one that sent the notice.
People that own their own businesses have a harder time of figuring out taxes. In some cases, the IRS may find your business to be more of a hobby and disallow business tax deductions that you made throughout the year assuming that you would be receiving that deduction at the end of the year. When this happens, the amount of taxes that you pay increases exponentially.
Make sure that you have affidavits and other receipts and items to prove that you have a profit motive. Expenses can only be tax deducted when they are used for the purpose of earning an income. If no profit is made, the IRS assumes that you were only doing it as a hobby, therefore, they deem it a hobby and not a business.
If you’re in the Southern California area, here’s a great tool to help you choose a reputable, professional tax attorney in Los Angeles and the greater LA area. Learn about the benefits of hiring qualified attorneys to handle all of your tax problems. Whether it is a personal income tax or business tax, all problems can be resolved with the proper legal help. Know your rights before paying taxes to the Internal Revenue Service.