The IRS Audit Blog

Archive for the ‘Audit Penalties’ Category

Question: tax filing – who is responsible for errors?

If a taxpayer sincerely depends on a professional tax preparer’s expertise & provides all requested back-up records, yet tax “expert” makes errors on the return (carelessness, ignorance or advocating a strategy not accepted by the IRS) who is responsible for the penalties & interest incurred from an audit – the paid tax professional or the filing taxpayer?

Answer: yes, the ultimate responsibility falls upon the taxpayer. the taxpayer is responsible for all tax, penalties, and interest.

however, some preparers will offer to fix the problem free of charge and even pay the penalties and interest (if you go back within a reasonable time) if it was truly his fault. the tax was always your responsibility.

now, if it was your fault. then you are responsible for all fees.

E-mails show pattern of county employee running other business

A Hamilton County employee who ran a private business using his county computer received a formal written warning for failure to follow county employment policies.

We Can Help You Avoid the IRS 6707A Penalty

Question: I received an audit letter asking for documentation of a few deductions from last year.?

The only problem is that I can’t find those receipts — am I going to go to jail? These were all cash-paid items and the store can’t retrieve them either.

I really don’t want to get into trouble with the IRS and will pay additional tax and penalty if I have to. I just don’t want to go to jail for this dumb thing. The deductions in question were about $7K and I made $30K last year.

Please Help

Answer: You aren’t going to jail. About the worst that will happen is that the auditor will disallow the deductions and you’ll have to pay the extra tax, penalty and interest. If you can show by some other means than receipts that you actually did buy the items in question, then they might even allow them.

Albany Bar Owner Pleads Guilty

State Tax Department says he charged customers taxes for drinks and food and pocketed the money.

TV model gets IRS audit penalties

Question: Can I file an amendment to my tax returns for the returns that are under audit?

I am being examined for my deductions. When I looked for the supporting evidence, I realized that I drastically have the wrong numbers for the deductions and kept bad records. I have been requested to go to an interview audit. Is there any way that I can amend those returns and pay those back taxes before I go to the audit and avoid further penalties?

Answer: Filing an amended return now won’t do anything to penalties. Just present the documentation you have and hope for the best. If the additional tax is less than $5,000 the auditor can take a pass on any penalties if you can show you didn’t intentionally under-report tax due.

Hannon Announces New Limited Time Tax Savings

Don’t miss out on your opportunity to grab up to 80 percent of the penalty and interest on your New York State Tax debts this new year. Senator Kemp Hannon (6th Senate District) is alerting taxpayers of a simple way to receive a significant tax savings.

IRS Tax Audit? Got an IRS audit? Heres what to do first

Question: depositing more than 10K in a bank at once…..?

I know that if you deposit more than 10K at a bank at once, they will fill out some sort of form and report it to the IRS (or at least I’m told). My question is, what if I deposited $9300 on Wednesday, and I deposit $7K today (two days later) It is over 10K, but it is not at once. Will my bank notice this on some sort of audit and report it to the IRS anyway? I have about another 18K that I need to funnel in before July. I want to take it out of my safety deposit box and into an account that earns interest. The bottom line is that I used to have a side business that sold mattresses wholesale and it was all cash. I never filled out a business licnese, and therefore never reported any of it to Uncle Sam. I don’t want the IRS auditing me to find out where this influx of cash came from and have to pay penalties and back taxes. So is it strictly 10K a day, or do they take a look at all of your deposits if they become abnormally high all fo a sudden? Thank you everyone.

Answer: If you deposit $9,300.00 today and then $7,000.00 two days later you will be fine.

The rule is for $10,000.00 in the same 24 hours.

By the way, the IRS does not have the right to audit any bank accounts.

To do that they need to get a Court Order and to do that they to give the Judge at least a reason.

The IRS audits only your taxes and not your bank accounts.

Only if they find something wrong with your taxes they will start an investigation.

The $10,000.00 is not a IRS thing. It’s a NSA thing. (National Security Agency) and a FBI thing and a CIA thing (Outside the United States of America)

They are trying to locate all the drug dealers, terrorists, kidnappers, hitmen and other dangerous criminals.

It’s not wise to place your name on that black list.

Health bills could expand IRS role

Under the proposed health care legislation, Internal Revenue Service agents would be checking to see whether Americans have health insurance.

Income Tax Filing: Tips To File Income Tax On Time

Question: irs is auditing me, how i can estimate penalties and interest?

i want to know if there is a table where i can see the percentage of interest and penalties that they will charge me, is a fix amount or what?
vp and other guys thanks for u answers, but still isn very clare, u said 20 of penalty plus interes of 6 plus aditional penalty of 6 percent annually? would ya explain a little bit more? thanks
i do appreciate your answers my friend i get an idea, somebody told me worst things like that have a nice day

Answer: Failure to file penalty: 4.5% per month or fraction, up to a total to 22.5%

Failure to pay penalty: 0.5% per month or fraction, up to a total of 25%

Interest: currently at 4% per year, no limit.

If you are a business, you could also get a failure to deposit penalty, which is 2%, 5%, 10% or 15%, depending on how late your deposit is.

Don’t Get Scammed on Your Tax Refund

Itching to get your due from Uncle Sam? There are plenty of folks — legit and otherwise — who will happily promise to help you get a faster or bigger refund.

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