Tips for small business on avoiding IRS audit

1. Use accounting software to keep books on a daily basis and input all financial transactions into this software. The client should use one database for their business and one for personal financial data to ensure that 100 percent of

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Posted in Appeals & Audit Resolution, IRS Audit

Reduce the chance of getting audited

Except for tax protestors, no one wants to fight with the Internal Revenue Service. That's why there's such a mystique about avoiding an audit. While what-triggers-an-audit theories abound, there are some basic things you can do to reduce your chances

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Nonbusiness Energy Property credit

Taxpayers who take energy saving steps this year may get bigger tax savings next year. The Nonbusiness Energy Property Credit, a tax credit for making energy efficient improvements to homes has been increased as part of the American Recovery and

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Posted in Energy Efficient Tax Credit, Tax Credit

Personal exemption change for 2010

For the year 2010, the personal exemption amount is $3,650 for yourself, your spouse and each dependent you are eligible to claim. This amount is unchanged from the 2009 amount. However there's one significant change for 2010. Unlike previous years,

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Posted in Exemption

IRS Offers Guidance on Barter Reporting

In its simplest form, bartering is the trading of one product or service for another, usually with no exchange of cash. With the economy in its present state, the IRS has seen an increase in bartering exchanges. As a result,

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941 vs. 944 filing – Revenue Proceedure

Revenue Procedure In Rev. Proc. 2009-51, IRS sets forth procedures for employers to opt in to filing Form 944 (Employer's Annual Federal Tax Return) and for employers previously notified to file Form 944 to opt out and file Forms 941

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Posted in Employment Tax

ITIN issuance generates questionable returns

Billions of dollars in tax credits are being provided to Individual Taxpayer Identification Number filers without adequate verification of eligibility, according to the Treasury Inspector General for Tax Administration. The Internal Revenue Service provides ITINs to individuals who are not

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IRS starts special unit targeting the wealthy

The IRS is setting up a special unit that will take a more skeptical look at the various strategies used by the wealthy to reduce their tax burden (see Shulman Has ‘Some Sympathy’ for CPA Concerns). That includes trusts, real

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Posted in Appeals & Audit Resolution, Tax Abuse, Tax Fraud, Tax Guidance & Preparation, Uncategorized

NEW – Schedule L for Standard Deductions

The IRS has released a new tax form, Schedule L, Standard Deduction for Certain Filers (2 pages including instructions, pdf) for use with 2009 tax returns. Taxpayers may need to use this form if they are claiming various additions to

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Posted in Tax Guidance & Preparation, Tax Problems & Requests, Tax Relief, Taxable Income

Net Operating Losses

Sec. 172(a) allows taxpayers to deduct against a tax year's income those net operating losses both carried over to the tax year from previous tax years and carried back from later tax years. An NOL basically is the excess of

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Posted in Net Operating Loss, NOL
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