Last year, the IRS audited about 1 million tax returns. While overall the 0.5 percent rate is low, the rate increases for high income earners. On the other end of the spectrum, those who claim an Earned Income Tax Credit (EITC) are also more likely to get an audit notice.
How is the new 20-percent (section 199A deduction) deduction calculated for pass-through businesses? Knowing some acronyms helps: Qualified business income (QBI) and specified service trade or business (SSTB).
When the IRS’s Criminal Investigations division (CI) looks in to possible tax fraud, it never does so in the abstract. To the contrary: the CI is transparent about how it classifies the areas it the areas and lines of inquiry it may pursue.
How will a lesser-known rule in the Tax Cuts and Jobs Act of 2017 affect wealthy flow-through business owners? The new limitation on loss deductions might be worth an Q4 discussion with a tax professional.
Over the summer, the IRS published final regulations with charitable contribution substantiation and reporting rules. You should now keep a record for all cash gifts that you will use as a tax deduction – a letter from the organization or a bank statement is usually enough.
The IRS initially communicates with taxpayers via form letter through the mail. Each of the forms has a different identification code. In the case of CP508c, the Service is notifying you that it has certified your tax debt to the State Department as seriously delinquent.
The Foreign Account Tax Compliance Act (FATCA) came with a stick as well as carrots. The federal law requires foreign financial institutions to share U.S. taxpayer information for holdings whether through direct ownership or another foreign entity. The aim was to make it harder to hide assets offshore to avoid federal tax.