The IRS Audit Blog

Archive for February, 2006

If you're new here, you may want to subscribe to my RSS feed. Thanks for visiting!

Va. governor outlines bold economic plan, is vague on funds

RICHMOND — Virginia’s new governor, Robert F. McDonnell, outlined a series of ambitious and costly proposals Monday night to create jobs and spur economic development, including adding tens of millions to programs that lure businesses to the state, making new investments in the tourism, wine and…

Richmond Tea Party – Richmond, VA; Tax Day April 15, 2009

Question: IRS Tax audit penalty on ebay transactions.?

My husband filed tax as married jointly in 2008. I was selling things on ebay off and on, those were new game consoles. I made about $500 profit. We did not consider that that was also an income. he filed my income as ‘no income’ unknowingly. now we got a letter from irs for tax audit. they have given penalty for $4000. please advice what to do?

Answer: First off, IRS does not work that fast. Look carefully at the year in question. It is more likely to be 2007.

Next, it is also unlikely that you have received an “Invitation” to an audit, ie “come on down and prove your deductions”. More likely, you received a form CP-2000 (look at the top right corner of the form), which is a computer generated form from the Automated Under Reporter Program. It will tell you that someone (Presumably eBay) reported that you received income and that it was not reported on your tax return.

That part is probably correct. However, it is not the bottom line because you incurred expenses in creating that income. Once the correct information is in their hands, they will re-figure tax and penalties based on the $500 of profit.

Now, you can try to fix it yourself but that is what created the problem. To put this to bed with the first response and pevent a back and forth of nastygrams from IRS and replies, I cannot urge you strongly enough to spend a couple hundred bucks and engage an Enrolled Agent. Look in the yellow pages under “Tax Preparers” for people with “EA” after their name.

City, feds end feud over cash for Metro

Fort Wayne has settled its dispute with the federal government, ensuring the local Metropolitan Human Relations Commission won’t lose a large chunk of its revenue. An internal city audit released Friday reveals steps the city took to comply with federal accounting rules.

EXCHANGES #440 15 USC CHAPTER 2B – SECURITIES EXCHANGES

Alabama governor sets big agenda for final year

Alabama’s lame-duck governor laid out a lengthy agenda Tuesday night for his final year in office, including stopping gambling, legalizing charter schools, and writing lean budgets that won’t saddle his successor with spending cuts. “Let us tackle the big… Alabama – Gambling – Lame duck – United States – Education

Tax Attorney Or Lawyer

Question: Can you help me out fill the form W 4 2009?

Call me stupid or whatever, but I get confused with this part:

5
Total number of allowances you are claiming (from line H above or from the applicable worksheet on page 2)
6 $
6
Additional amount, if any, you want withheld from each paycheck
7
I claim exemption from withholding for 2009, and I certify that I meet both of the following conditions for exemption.
c Last year I had a right to a refund of all federal income tax withheld bec ause I had no tax liability and
c This year I expect a refund of all federal income tax withheld because I expect to have no tax liab ility.
7
If you meet both conditions, write “Exempt” here

What numbers should I input there? Please help, this is the first time I fill one of these forms.

Website: http://www.irs.gov/pub/irs-pdf/fw4.pdf (The part I’m asking for is almost at the bottom of the first page.

Answer: On line 5 you put down whatever number you have on line H, unless you needed to do the worksheet, in which case you take the number off the worksheet. You haven’t asked anything about how to do the worksheet or how to fill out lines A-H.

Leave line 6 blank unless you used the second worksheet or you have lots of income from sources other than wages.

You don’t say how much you expect to earn in 2009 from all jobs and other sources. Unless we know that we can’t begin to tell you whether you are exempt.

Tax Tip: 10 things to know about the Making Work Pay Tax Credit

Many working taxpayers are eligible for the Making Work Pay Tax Credit, a provision created by the American Recovery and Reinvestment Act in early 2009.

Recovery: Making Work Pay – Married – August 2009 (ASL, Captions & Voice Over)

Official: Plane crash pilot left anti–IRS Web note

AUSTIN, Texas (AP) —- A software engineer furious with the Internal Revenue Service plowed his small plane into an office building housing nearly 200 federal tax employees on Thursday, officials said, setting off a raging fire that sent workers fleeing as thick plumes of black smoke poured into the air….

EEP100 – Lecture 13