Deducting Your Travel Expenses

If you are commuting or traveling for business, the IRS will normally allow you to list travel expenses in your itemizations. Whether the expense was incurred locally or globally, you can still deduct a portion. Nonetheless, knowing when deductions are allowed and how much to deduct can prove difficult.

If your employer is reimbursing your expenses, you are not allowed to deduct them. Employers are also allowed to pay “per diem” rates per month. You cannot deduct more than the per diem rate per day from your taxes. This rate fluctuates based on the city. Current rates are $172 per day for any low-cost locality and $259 for any high cost locality. This includes the cost of lodging, meals and incremental expenses. Instead of reimbursing employees for actual business expenses, employers can choose to reimburse employees for these amounts. The first and last day of the trip are reimbursed at 75% … Read More

Consider Filing for an Audit Reconsideration

Simply hearing the word “audit” can often make taxpayers shudder. But these situations are not hopeless. If you were surprised by an unexpected audit and were unprepared, you may be able to file for reconsideration. There is usually no form required. Simply mail your request to the office which issued your examination report. The IRS generally responds with a decision within 30 days

Before you submit a request for reconsideration you should carefully review the previous examination report and identify which items you believe are incorrect. You can file a reconsideration request if you meet any of the following criteria.

  • You did not appear for your audit.
  • You moved and did not receive correspondence from the IRS.
  • You have additional information to present that you did not provide during your original audit.
  • You disagree with the assessment from the original audit.

If you meet one of the listed requirements, you should … Read More

The IRS Dirty Dozen

Each year, the IRS releases a list of the 12 most common scams that taxpayers may encounter during tax season. Here’s a run-down of the top scams of 2014 and how you can protect yourself.

1. Identity theft

How it works: Someone gets ahold of your personal information—such as your social security number—and commits fraud in your name. They may even file a tax return in your name to get a refund.

How you can protect yourself: Keep your info private by using encrypted passwords online and shredding personal paperwork when you no longer need it. If you think your identity has been stolen, contact the IRS Identity Protection Specialized Unit at 800-908-4490.

2. Telephone scams

How it works: Callers pretend to be from the IRS in order to steal money and personal information. They often say that you owe money and may be arrested if you don’t pay.

How you … Read More