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matt swango

How to Avoid an IRS Audit - Yahoo! Finance - 0 views

  • Tax season is upon us, with most Americans putting together the materials they need to file their returns, gathering receipts, and searching for other tax deductions to maximize the amount they get back from the federal government.
  • If the IRS begins to suspect that a tax return isn't entirely truthful, the filer might be in for an audit.
  • Only about 1.1 percent of people who file a 1040 [the most common tax return] for the 2010 tax year were audited ... [or] about 1.5 million," says Rozbruch. "However, the audit rate is 12.5 percent for people earning $1 million or more in 2010.
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  • audits are most often triggered by the kind and amount of deductions taken
  • a professional should be hired in all audit cases.
  • For example, after widespread fraud was discovered, the IRS audited most taxpayers who claimed the First-Time Homebuyer Credit," Reed says. "The Earned Income Credit and the Adoption Credit are also common audit targets, but these are also credits that are often abused, so it makes sense for the IRS to verify that taxpayers qualify for them."
  • Two common examples are receipts for contributions to charity and mileage logs. When taxpayers try to recreate these expenses, they discover it is hard to remember events that happened more than a year ago," Reed says. "In the absence of good records, the deductions are disallowed when audited."
  • According to Rozbruch, the best track to take when an audit begins is to attempt to make things right immediately.
  • Reed adds that if the taxpayer is not maliciously trying to cheat the government, the IRS can be lenient.
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    Tax season is upon us. Here's some tips to avoid an audit
Michael O'Connor

Apple case seen as possible spur to tax action - Yahoo! News - 0 views

    • Michael O'Connor
       
      This is the bottom line. They don't have enough money to pay the deficit off...so lets punish successful companies to do so
  • The focus on Apple's taxes comes at a time of heated debate in Washington over whether and how to raise revenues to help reduce the federal deficit
  • "We pay all the taxes we owe — every single dollar," Cook said. "We don't depend on tax gimmicks."
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  • He punched out words when stressing the 600,000 jobs that the company supports, and underscored that Apple is the nation's largest corporate taxpayer.
  • Cook did so voluntarily
  • In effect, Apple is holding out for a lower corporate tax rate, and Cook spent some of his time in the spotlight to advocate for one, as well as a streamlining of the tax code to eliminate deductions and credits.
  • At the same time, lawmakers must tread lightly as they attack Apple, a company held in high esteem and whose ubiquitous products are seen as both innovative and indispensable
  • "What Apple is doing is pretty mainstream," said accounting expert Robert Willens, in an interview. Shifting around the intellectual property rights has a minor effect compared to the simple avoidance of U.S. taxes by not repatriating profits, he said.
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