Irs Audit Self Employed
October 29th, 2009
Question: Do I get in trouble for over-reporting my income on tax returns? Or just under reporting?
I’m self-employed. If I don’t take all my deductions, in order to make my net look higher than it would be otherwise, does the IRS care? After all, they’d be making more money right?
In other words, are deductions optional?
Also, what if I accidentally put a larger gross than I actually made? Won’t an audit reveal I’m due a refund?
Answer: You could get in trouble , if caught, if you did it in order to commit fraud. Two possibilities come to mind: Exaggerating your income to increase earned income credit (defrauding the government), or exaggerating your income to qualify for a loan (defrauding the bank).
Tax Tips: The joys (and woes) of self employment
As the economy continues to stumble along with uncertainty, many are starting to look at the self-employment option as the way to get ahead.
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Tags: employment option, filing taxes, flickr, IRS Audit, money right