The IRS Audit Blog

Posts Tagged ‘tax audit’

Question: what is the last date to file a company income tax return having tax audit for the financial year 2007-2008.?

Answer: September 30, 2008. Form ITR-1 to ITR-8, BA, 3CA, 3CB and 3CD.
Read about the dates with income tax: http://mytaxes.in/index.php?topic=51.0

RAM Ratings Assigns AA3/P1 Corporate Credit Ratings to Saudi-based Dar Al-Arkan Real Estate Development Company

KUALA LUMPUR, Malaysia—-RAM Ratings has assigned respective long- and short-term corporate credit ratings of AA3 and P1 to Dar Al-Arkan Real Estate Development Company ; the long-term rating has a stable outlook.

A Look at 2010 and Beyond

It would be an interesting, albeit purely academic exercise to imagine how the advertising industry would look right now if we hadn’t been hit with the biggest economic downturn since the 1930s.

Tax deduction cool tricks

“Are You Nuts”

That was the response I received from the first client I spoke with a few days after opening our doors for business. The husband and wife were questioning my sanity because I was suggesting that the time was right to be investing in a product that is secured by real estate. Yes, I have heard of investment companies being in trouble and note almost daily the number of published articles in newspapers, magazines and on the internet that are painting a picture of doom and gloom. As a matter of fact the Calgary Herald has just printed an article with the following headline in bold print: “Commercial Real Estate Suffers $1-Billion Drop.” Based on the headline anyone thinking of investing in commercial real estate would be putting their investment funds back under their mattress.  The article was about how commercial real estate sales had decreased from 2008. What it failed to mention was that in 2008 and years preceding the number of sales were inflated because Calgary was the “hottest market for commercial real estate in North America.” That market is returning to normal which is a good thing. One should not always take media hype at face value. If you analyze and complete due diligence before you invest you will be making informed decisions based on fact and that will provide you with lucrative ways to increase your net worth even in these embattled times. So my answer to the, are you nuts, question is a definite NO!

“What Should We Look For?”

The investment promoter should be willing to give you their legal documents so that you can read and understand them yourselves, or with the assistance of legal and/or accounting advice. When an offer is made they should provide you with access to the due diligence that they complete. That should include current appraisals, engineer’s reports, environmental studies, a review of the leases and title searches to ensure that there are no undisclosed liens or problems. You will want to be assured that your funds are held in a trust account and that some form of audit is completed on the account. After you have invested you will want to know on at least a quarterly basis, if not more frequently, how the building you have invested in is performing.

Some investment companies still try to entice investors with projected returns that cannot be substantiated. The only return that is real is the cash flow. Therefore, you should note the following:

1)      Who are the tenants and when do their leases expire?

2)      Is there a good mix of tenants or does one tenant occupy the majority of the leasable space?

3)      What is the basic rent they are paying and how does that compare to market rents?

4)      What are the operating costs and is the amount collected from the tenants sufficient to cover all operating expenditures?

5)      Who will actually own the property and how will your interests be protected?

6)       Is there a mortgage on the property?

7)      What is the amount being mortgaged? What is the rate? Are there prepayment penalties? What is the lenders receptivity to renewals and refinances? 

If you have done your homework and you are satisfied that the company promoting the investment has done theirs real estate can be a safe short, medium or long term investment.

“Is There One Investment Product that I Should Consider?”

Syndications of commercial real estate have been around for a long time. The newest syndication product in the market is the private mutual fund trust secured by real estate. Some companies offer this product with debt while others provide a debt free property as security.

“Why Invest in Debt-Free Real Estate?”

1)      Income is based on lease payments for a contracted period of time and amount from long term tenants with strong covenants.

2)      Your capital is protected and will be there when it is needed.

3)      Your return is steady and is not based on predictions or gimmicks.

4)      Income and profit are maximized by not having to pay a mortgage.

a) Being mortgage free reduces risk of loss.

b) Real estate consistently stays ahead of inflation.

c) Real estate avoids stock market volatility.

5)    It provides a dependable, secure income for retirement, a rainy day or a child’s education.

6)    This type of investment is ideal for registered products like RRSPs, RESPs, Liras and RRIFs. It also is an excellent way to maximize the tax free returns in your tax free savings account.

7)    Purchasing real estate with cash often allows for a better purchase price as a quick closing puts cash in the vendors pocket in much shorter period of time than if mortgage financing was required. From the vendor’s point of view this is a positive and often leads to a reduced purchase price. This, in turn, means that the potential for an increased capital gain at the time the investors sell the property is greater.

Summary

Investing in products secured by commercial real estate is still a safe and sound way to provide a positive source of growth in your investment portfolio. The key to investing in the right product is to ask the right questions and to make sure that you are comfortable with the company promoting the investment. Syndication is a popular way for everyone to invest in real estate as groups of investors provide the funds for a purchase that would normally only be available to wealthy individuals. The newest form of syndication is the private mutual fund trust. Debt free real estate provides the safest and best security for investors.

County plan says parks need tax help

The survival of Milwaukee County’s extensive parks system calls for adoption of its own sales tax or a dedicated property tax, according to a long-range plan by the county parks department.

Calculating Taxes : How to Calculate Sales Tax

Question: nys tax audit help! child care tax credit?

iv recived an letter in the mail stating the Nys needs more proof for me to be allowed to recieve the child care/dependant care credit tax. So i mailed back reciepts from child sitters.i had the flu so my cousin mail them back but she put the mail in the mail box instead of taxing it to the post office.did i need to take that to the post office or the mail box was okay??
And how long should it take to recieve my state taxes?? Weeks months??

Answer: i dont think how they mailed it matters…???

it’s going to take weeks, not months… i’d say, depending on weather your getting a check or direct deposit it’ll take like 4 weeks.

County bond rating downgraded

Adams County has money in the bank but it still has a credit problem.

The Fed – Out of Control – End the FEDERAL RESERVE. Audit the FED

In November 2009, the IRS launched a new National Research Program Initiative (the Initiative): an industry wide detailed random audit of employment taxes for 6,000 businesses over the course of the next three years. The purpose of the Initiative is two fold: (1) assess systemic employment tax compliance; and (2) collect assessments from delinquent employers.

With tax revenues dwindling from the recession, the U.S. Treasury Department is stepping up efforts to close the tax gap the difference between overall tax liabilities and taxes paid to the IRS. Auditing employment taxes is seen by the IRS as a crucial means of closing the tax gap. For tax year 2001 for example, the gross tax gap was estimated by the IRS at around $345 billion, with underreporting of employment taxes accounting for around 17% of the tax gap.

The IRS will audit businesses to ensure that Federal withholding taxes are deducted and paid over to the government from employees wages for Social Security and Medicare as well as Federal Unemployment taxes. An employer found to be in noncompliance could face stiff civil penalties and interest on unpaid taxes. These penalties could have a particularly severe impact on small business owners.

The IRS has prioritized four areas to focus their auditing efforts under the Initiative, including:

aE¢ Worker classification: i.e. whether an employer properly classifies an employee as an employee or independent contractor for tax purposes. Determining which depends on the behavioral, financial and type of relationship the company has with the person performing the work.

aE¢ Employee fringe benefits: A fringe benefit is a form of pay for the performance of services. i.e. benefits such as insurance coverage, company car or child care, etc. that are provided by employers tax free to employees but not to independent contractors.

aE¢ Reimbursed business expenses: e.g. reimbursement for taking a client to lunch, purchasing office supplies: which requires a written business expense plan. I.E. You must have paid or incurred expenses that are deductible while performing services as an employee. You must adequately account to your employer for these expenses within a reasonable time period, and you must return any excess reimbursement or allowance within a reasonable time period.

aE¢ Compensation of owners who are also employees of the company, whereby unpaid taxes may result in personal liability for the employer.

Now that the Employment Tax audit Initiative has started, it has been reported that the IRS has already begun the process of selecting businesses for audit of their employment taxes. Noncompliance with employment tax law can result in severe consequences for employers. To ensure that procedures are in place for Employment tax compliance with applicable tax law can save time, money and heartache in the event of an audit.

For example, the Internal Revenue Code requires a written reimbursement plan in order to take advantage of the tax benefits of legitimate business expenses. Employers should consider consulting with experienced counsel in preparation for the Initiative and in the event of an audit of their employment taxes.

BURLINGTON COUNTY: Freeholders name Garganio director

Former Florence councilman Bruce Garganio joined the county government Jan. 1 when he began his first term as a member of the Board of Chosen Freeholders and became its director for 2010.

Turbo Tax Rap — Aw Dip (The Audit Song)