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Posts tagged "IRS Tax Audits"

Many taxpayers starting to feel the impact of IRS budget cuts

We've naturally been paying close attention to the story of how federal budget cuts will affect the IRS. When we last wrote about it, on March 4, the word was that the IRS intended to delay furloughs of employees until after the April 15 income tax filing deadline. Furloughs are essentially mandatory, unpaid vacation days that are used to implement cuts in agency budgets.

Tax audit warning flags, part 3: be wary of unusual tax deductions

Beauty, it's often said, is in the eye of the beholder. But that isn't really true of tax deductions. No matter how necessary a certain expense may seem to a given taxpayer, that doesn't mean the IRS will agree.

The IRS and federal budget cuts: furloughs to be delayed until after April 15

In our February 11 post, we discussed the prospect that federal budget cuts could affect the ability of the IRS to assistance taxpayers and to enforce tax law through audits and investigations. These cuts, known by the shorthand term "sequester," began taking effect on March 1.

A downside of e-filing: data fields ripe for tax audits

The problem of tax-return fraud involving identity theft is so large that there are many different aspects to it. Last week, we wrote about the issue of how the IRS is responding to the challenge of processing returns without undue delays.

Medaling in Olympics leaves athletes with IRS tax bills

The 2012 London Olympics are rapidly approaching their conclusion and they have provided quite a thrill to viewers in California and around the world. From unexpected triumph to heartbreaking disappointment, the Olympics present a compelling and unfiltered view of some of the human emotions that come out during athletic competition.

IRS seeks businesses engaging in payroll tax evasion

The past few years have undoubtedly been difficult on a number of California small businesses. Owners and entrepreneurs have had to tighten their belts to meet the realities of an economy slow to embrace a lasting recovery. One popular strategy has been to hire independent contractors to perform work because a company can reduce the benefits it pays out while incurring lower payroll taxes.

Restricted stock units leave some workers with high tax bills

Investors will soon be able to own a portion of California-based Facebook when the company goes public. While the imminent initial public offering is a source of excitement for some, it may be cause for concern among some Facebook employees. Because of an interesting provision in the Tax Code, Facebook estimates that its workers will owe the Internal Revenue Service and the state of California a total of $4 billion in taxes when the company's shares hit the open market.

Certain tax returns more likely to be audited by IRS

At this time of year, taxpayers in California and around the country are hoping to avoid the dreaded tax audit letter. The good news is that the Internal Revenue Service only audits a small percentage of the overall population--currently about 1 percent. The bad news is that audit rates are much higher among certain groups of taxpayers, whose returns single them out for additional IRS scrutiny.