5 IRS Misconceptions and Stereotypes
When you think about the IRS, what comes to mind? Intimidation? Fear? Dread? There are many misconceptions and stereotypes about the IRS and, in fact, some of the things that are often assumed about the IRS turn out not to be the truth. Read on to see which IRS myths are debunked!
Myth #1: Common requests trigger an audit.
There are many myths about what triggers an audit. Some people think that amending a return, requesting an extension and even e-filing increases your risk of being subject of an audit.
By themselves, these three actions do nothing to increase your chances of being audited, particularly if you have the documentation to back them up.
The IRS actually has a calculation that it uses to determine whether you should be audited. They look at the difference between your return and a model that represents similar returns (DIF).
Myth #2: Audits are common.
Many Americans think that audits are much more common than they really are. In fact, audits require a lot of time and money. And they certainly do not always result in a financial gain for the IRS.
The reality is that only 1% of taxpayers are audited each year. That means that you have a very low probability of being picked.
Of course, there is always a chance, but audits should not be feared. Often times, the issue in question can actually be resolved quickly and easily, and without further inquiry.
Myth #3: You may go to jail if you do not pay your taxes.
This is simply not true. There are instances in which you could go to jail if you purposefully cheat on your taxes (fraud), but never because you owe the IRS more money than you can pay.
In fact, the IRS actually offers several programs for those who are unable to pay their taxes —installment agreements, offer in compromise, etc.
Also, the IRS also cannot just garnish your wages or seize your property without significant correspondence with you beforehand. This action requires multiple direct communication requests from the agency.
Myth #4: IRS representatives are not helpful.
Many people decide not to contact the IRS with routine questions because they assume that the representatives are unfriendly or unhelpful. This is generally not the case.
We understand that there is an intimidation factor here, but in most cases it is in the IRS’s best interest to answer your questions as it saves them time down the road.
The IRS has also put significant work into their website to make it a useful resource that can help you find answers to your common questions.
Myth #5: If you cannot pay your entire tax bill, you should not file.
This is entirely false. Not filing your tax return only makes things harder on you down the road. If you file and are unable to pay your tax bill you may be assessed interest and penalties, but failure to file is more serious than being unable to pay.
Many people have concerns about dealing directly with the IRS. There are many stereotypes and myths that are perpetuated by the endless ads each spring designed to scare.
Success Tax Relief does not believe in these scare tactics. There are many people that need tax help and many that do not. If you need help dealing with the IRS, contact us today. Consultations are free.