The IRS Audit Blog

Archive for July, 2007

Question: Where’s the money? Trillions missing from DoD (US Dept of Defense)?

Trillions of dollars in “unsupported adjustments” means trillions of dollars unaccounted for. What’s going on? Where is the money? How could this happen? Where are the checks and balances? How much more has gone missing? Is this happening in the other government agencies too? What would happen if a corporation failed to pass an audit like this? Or a taxpayer? Who is responsible for this? Who can we trust to fix it?

Answer: You are absolutely correct. The number is estimated at between 2.3 and 2.6 Trillion dollars. Roughly $8,000 dollars for every man, woman and child in the United States. At the time, the then Secretary of Defense, Donald Rumsfeld brought this to the attention of Washington D.C. on September the 10th, 2001. Of course we all know what happened the next day and all was soon forgotten.
It’s interesting to see that we get all worked up about John Edwards’ haircut or Scooter Libby, but issues such as this – issues that deserve wall to wall media attention – are somehow considered of less importance. I just don’t get it.
Can I say it again? Washington D.C. needs an enema.

Marshall County sheriff ‘pleased’ with audit

Marshall County Sheriff Scott Walls said he is “pleased” with the results of a two-year audit filed Friday involving his office’s financial records and public accounts.

National Taxpayer Audit Helpline

Question: Roth IRA question for a friend?

I have a friend, and he opened a Roth IRA account two years ago in citibank, now he is 56 years old, he decides to move the money to www.scottrade.com , can he withdraw the capital gain when he turns to 59 1/2 years without penalty? If counting from the date he opened the account in citibank, it will meet the 5 years period when he turns to 59 1/2 years old, but it is less than 4 years if counting from the date he opens the account with scottrade.

How can Scottrade know when he began to contribute to Roth IRA account? Because it only transfers cash from citibank to scottrade, no deposit record.

If he withdraws capital gain before 5 years period, who does he need to turn the penalty to? IRS? How? Write a check along with the tax return form?

Thanks a lot!

Answer: He does a trustee to trustee roll-over and the date he first opened the account remains the same. I don’t think he calculating the 5 year rule correctly however. Before he makes any withdrawal he should check with the holder of the IRA about that issue.

It’s the Law: Estate tax is dead, but comes back to life next year

Q: I heard that the Estate Tax was abolished. Is that true?A: It’s complicated. The estate tax rules were overhauled by the Economic Growth and Tax Relief Reconciliation Act of 2001 (the Act). From 1987 through 1997, $600,000 of an estate was exempt from estate taxation. That gradually increased to $675,000 in 2000 and 2001.The Act changed the taxation landscape. Beginning in 2002, the amount …

Text of Strickland’s State of the State speech

The text of the State of the State address Tuesday by Gov. Ted Strickland:

Dayton, Ohio Tea Party tax protest 4-15-09

Question: Help! I got a letter about my taxes I don’t understand! Do I owe, or do they owe me?

I got a letter in the mail today from the IRS (form 2210 & 2008 tax form 1040EZ). I’ve never done my taxes.. I’ve always had someone else do them, and nobody in my family (or I) understand what this thing is talking about.. The form instructions talk about “underpayments” and “penalties”, but the other form they sent that shows my & IRS figures says “Amount of Overpayment: $102″ and “Total amount of refund per this notice (interest added, if any): $102″

Does this mean I owe them $102? Or do they owe me? What am I supposed to do?

Answer: Sounds like they’re sending you $102. Show the person who prepared your taxes all the paperwork. Should be receiving a check in the mail or check your bank for DD of $102.

Don’t be so afraid of taxes. You are a reasonably intelligent adult, and you CAN figure out and file your own 1040EZ. Get the forms and instruction booklet from irs. It’s a short, simple form. Read the instructions and follow them line by line. You can do it and you will be assured that your taxes are properly done.

. . .or Call the number on the notices you received with the paper in hand and ask the IRS about the notices.

Tax credit claims could limit Free File

The IRS’s Free File option is back. But this year, credit claims could leave some filers out.

NO LAW MANDATES You Pay INCOME TAXES! (2/ 10) Federal Reserve; IRS EXPOSED!