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IRS Tax Filing HelpYour risk when you do not file tax returnsAny person who does not file a tax return to pay a tax or estimated tax, in addition to other penalties, may be charged with a misdemeanor, be subject to a jail term of not more than 1 year and subject to a $25,000 fine ($100,000 in the case of a corporation). IRC § 7203.If a person willfully fails to file a tax return and pay the resulting tax liability, the taxpayer may be charged with a felony and subject to a jail term of up to 5 years, in addition to other penalties. IRC § 7203. You can eliminate any possibility of being prosecuted for tax fraud when you voluntarily file all un-filed tax returns. A person would not be charged with “willful” tax evasion if that person voluntarily files tax returns, provided the voluntary filing commences before any IRS criminal investigation. An un-filed tax return will not start the statute of limitations. The general rule is that the IRS must assess a tax within 3 years after a tax return is filed. IRC § .6501(a). This failure to file gives the IRS the right to examine that tax year anytime within your lifetime. In the case of the failure to file a return, the tax may be assessed, or a proceeding in court for the collection of the tax may begin without assessment at any time. §6501(c)(3) The failure to file a tax return without reasonable cause will generate a penalty of 25% more than the tax liability. § 6651(1)(1) When you file a tax return at your local office, the IRS will stamp a copy of your tax return as “received by the IRS ” so that you will have first hand proof that your tax returns are filed, and you do not run the risk that the IRS will lose your tax return. Your local walk-in IRS office may be found at this link: http://www.irs.gov/localcontacts/ There is no penalty for failure to file a tax return if a refund is due. In order to receive a refund, the return must be filed within 3 years of the due date. If you file a return, and later realize you made an error on the return, the deadline for claiming any refund due is three years after the return was filed, or two years after the tax was paid, whichever expires later. Taxpayers who are entitled to the Earned Income Tax Credit must file a return to claim the credit even if they are not otherwise required to file. The return must be filed within 3 years of the due date in order to receive the credit. If you are self-employed, you must file returns reporting self-employment income within three years of the due date in order to receive Social Security credits toward your retirement. You should file all tax returns that are due, regardless of whether or not full payment can be made with the return. If you cannot pay at the time you file your tax return, you may qualify for either an Installment Agreement or an Offer in Compromise. The IRS will impose a late filing penalty of 25% for a late filing or five months or more plus interest. There is no penalty if a refund is due. But by waiting too long to file, you could lose your refund. In order to receive a refund, the return must befiled within 3 years of the due date. If you file a return, and later realize you made an error on the return, the deadline for claiming any refund due is three years after the return was filed or two years after the tax was paid, whichever expires later. If you are self-employed, you must file returns reporting self-employment income within three years of the due date in order to receive Social Security credits toward your retirement. If a person continues not to file a required return and fail to respond to IRS requests for a return may be considered for a variety of enforcement actions. Continued non-compliance by flagrant or repeat non-filers could result in additional penalties and/or criminal prosecution. Garon Tax Group (GTG) Tax Preparation Services Full tax preparation services are available for all tax returns by experienced tax return preparers. You need to provide: accurate data to input on your tax returns. We provide the necessary forms and schedules. All available supporting documentation must be provided to us. If you are considering another tax return preparer, be careful in selecting the tax professional who will prepare your return. Some basic tips and guidelines to assist taxpayers in choosing a reputable tax professional are:
If you do not have primary documentation to support your income and deductible expenses and exclusion, secondary documentation may be sufficient. If it is necessary to estimate any numbers on a tax return because the support documentation is not available, you can estimate those numbers if reasonable and made in good faith provided that you make full disclosure of that estimate with an attachment to your tax return. Never lie on a tax return. Taxpayers hearing claims from preparers offering larger refunds than other preparers are encouraged to check it out with a trusted tax professional or the IRS before getting involved. A separate engagement letter will be issued to you from a qualified and experienced tax attorney, if needed or as needed for any complex issue or problem that might be identified, to represent you before the IRS, or for any other matter that would require the services of a tax attorney. You are legally responsible for what’s on their own tax returns even if prepared by someone else. : A Paid Preparer is required by law to sign the return and fill in the preparer areas of the form. The preparer should also include their appropriate identifying number on the return. Although the Preparer signs the return, you are responsible for the accuracy of every item on your return. In addition, the preparer must give you a copy of the return. Review the completed return to ensure all tax information, your name, address and Social Security number(s) are correct. Make sure that none of these spaces is left blank. Review and ensure you understand the entries and are comfortable with the accuracy of the return before you sign. Never sign a blank return, and never sign in pencil. If you have provided specific authorization in a power of attorney filed with the IRS, you may have copies of notices or refund checks mailed to your preparer or representative; but only you can sign and cash your refund check. A Third Party Authorization Check Box on Form 1040 allows you to designate your Paid Preparer to speak to the IRS concerning how your return was prepared. Unqualified tax preparers may overlook legitimate deductions or credits that could cause clients to pay more tax than they should. Unqualified preparers may also make costly mistakes causing their clients to incur assessed deficiencies, penalties, and interest. Here are some suggestions to consider when hiring a tax professional: Avoid preparers who claim they can obtain larger refunds than other preparers. If your returns are prepared correctly, every preparer should derive substantially similar numbers. Beware of a preparer who guarantees results or who bases fees on a percentage of the amount of the refund. A practitioner may not charge a contingent fee (percentage of your refund) for preparing an original tax return. Choose a preparer you will be able to contact and one who will be responsive to your needs. Ask who will actually prepare the return before engaging services. Avoid firms where your work may be delegated down to someone with less training or some unknown worker. You should know exactly who works with your tax matters at all times and how to contact him or her; after all, you are paying for it. Determine if the preparer is exporting your return to a foreign country for preparation. Foreign countries do not have the same security and privacy laws as the United States nor is there any recourse should your information be compromised as a result of lax or nonexistent privacy procedures. Unfortunately, unscrupulous tax return preparers do exist and can cause considerable financial and legal problems for their clients. Examples of improper actions by unscrupulous preparers include the preparation and filing of false paper or electronic income tax returns that claim inflated personal or business expenses, false deductions, unallowable credits or excessive exemptions. Return Preparer Fraud generally involves the preparation and filing of false income tax returns by preparers who claim inflated personal or business expenses, false deductions, unallowable credits or excessive exemptions on returns prepared for their clients. Preparers may also manipulate income figures to obtain fraudulent tax credits, such as the Earned Income Tax Credit. In some situations, the client (taxpayer) may not have knowledge of the false expenses, deductions, exemptions and/or credits shown on their tax returns. However, when the IRS detects the false return, the taxpayer must pay the additional taxes and interest and may be subject to penalties and criminal prosecution. Fraud on the part of a return preparer could also be attributed to a taxpayer under the law of “conspiracy.” To receive a FREE screening and qualification, please contact us for your IRS problem. |
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