5 Ways to Avoid Tax Problems with the IRS
The Internal Revenue Service (IRS) is an entity that intimidates most people. They are known for pressing charges on those who refuse to comply toward their tax obligations. Some of these offenders have even been sent to prison! It is no wonder that the IRS is feared by most!
If you follow these 5 helpful tips, you might be able to avoid any of those nasty tax problems with the IRS altogether:
1. File Your Annual Taxes
This is a big one. Neglecting to pay your taxes places a red flag next to your name. The IRS isn’t usually fond of those who refuse to report their income. It signifies that person may have something to hide. For all the IRS knows, you could be earning money illegally. What’s more, you may be entitled to a refund! Why wouldn’t you want to file? Furthermore, it is most advantageous to file on time if at all possible. Filing your taxes by the due date usually shuffles you right through the process with little to no hassles or inquires.
2. Report All Sources of Income
People may think that they only have to report the money they receive through their W2 forms. This is incorrect. The IRS requires that you report all sources of income, with or without a W2 or a 1099 form. In fact, it is required to report all income and estimated amount of expenses for that year. If someone has reported to the IRS that they gave you a certain amount of money, trust that the IRS will verify this. So any money that you receive that wasn’t taxed by the government doesn’t mean that it’s tax-free. It just means you’ll pay the taxes on that money at the end of the tax year.
3. Pay What You Owe
The IRS won’t bother you if you pay them what you owe. If for some reason, you are not able to afford to pay the amount in its entirety, then call the IRS to arrange a monthly payment plan.
4. Don’t Lie!
Lying on your taxes is not recommended! In fact, this might serve as an invitation for the IRS to call you! When filing your annual taxes, the best practice is to simply report the truth. Record the exact amount of income you made for that tax year. Claim the number of dependents that you actually supported. If you operate a business from home, report that—as well as any monies received from that business. Do that and you should be good!
5. Hire a Tax Preparer
To avoid any errors on your annual tax filings, it might be easier to just hire someone who is more knowledgeable with tax laws to do it for you. This way, you’ve avoided the hassle and stress that comes with filing. Plus, it’s worth mentioning that if the IRS takes issue with it, you won’t be the only person that has to answer for it. Hopefully, you’ve hired a legitimate service and that won’t be an issue.
Success Tax Relief can review your annual tax filing and verify if there are any potential errors. This will also minimize your risk for any problems with the IRS. Give our experienced team a call at 1-877-825-1179 or contact us online to schedule a risk-free consultation.