Avoiding an Audit: A Taxpayer’s Guide

One of the biggest fears a taxpayer may have is the dreaded phone call from the IRS or the letter in the mail labeled AUDIT.* Although your chances of being audited are slim (only 1% of U.S. taxpayers are selected), there’s good reason to want to avoid it—if the IRS finds out you’ve misreported income or expenses, you could be faced with back taxes, hefty fines, and possible jail time.

The selection process isn’t random; the IRS selects taxpayers for auditing if their returns raise questions—things like large deductions, extravagant purchases on a meager income, and cash-only business transactions are a few of the red flags that might put you on the top of the list.

Luckily, there are a few things you can do to keep your taxes in order and stay on the good side of the IRS:

Hire a Tax Professional

Using the services of a licensed accountant … Read More

Is Your Financial Situation Affecting Your Health?

According to a recent telephone survey conducted by Harris Interactive, nearly half of the American population is highly stressed about their financial situation, and this stress is spreading to other areas of their lives. Nearly half of those stressed aren’t sleeping well and find themselves becoming impatient with friends, and 31% are eating more junk food or gaining weight.

 The startling result of the survey draws a correlation between money and wellbeing—not only can financial stress cause weight gain, poor sleep, and strained relationships with loved ones, but these negative personal consequences may even create a higher level of money-related stress.”

“This can lead to a double whammy, with ensuing physical and emotional stress potentially leading to higher long-term costs,” says CPA Ernie Almonte.

But how can you get out of this vicious cycle?

A significant cause of money-related stress is a lack of understanding of one’s personal financial situation—navigating the … Read More

Breaking: 2013 IRS Furlough

The ink on 2012 tax returns was barely dry when the National Treasury Employees Union announced an IRS-wide furlough implementation for the 2013 calendar year. On five separate days in 2013, the IRS will be closed: May 24, June 14, July 5, July 22, and August 30. This means no answered phone calls, no conversations with IRS members about tax problems—in short, five very anxious days for anyone who needs tax help or advice.

Citing sequestration as the cause of this “disappointing development,” NTEU president Colleen M. Kelley voiced concerns about taxpayer impact, noting that while Tax Day may be over, many small businesses, taxpayers, and government entities still need IRS assistance to manage quarterly payments and fiscal-year business. But on the 2013 furlough dates, their calls will go unanswered. “I believe this is an unprecedented event that leaves taxpayers out in the cold,” Kelley said.

And taxpayer impact is only … Read More