Audit Feed

Doing taxes is all about the numbers. The forms require our Social Security number and that of our spouse and dependent children. Similar identification digits also are key on tax forms from, for example, our employers and other entities that contribute to our taxable income. And, of course, we have to put in all those figures about our earnings and subtract the numbers in the form of expenses and deductions and credits to get to the most important amount of all, our final tax bill. Today's the 30th anniversary of the math-inspired unofficial holiday Pi Day is a good time... Read more →


UPDATE, Feb. 8, 2018: The Trump Administration made it official this afternoon, announcing Donald J. Trump's intent to nominate Charles P. Rettig as the next commissioner of the Internal Revenue Service. If confirmed by the Senate, Rettig will serve a five-year term that began Nov. 12, 2017, when prior commissioner John Koskinen left. Tax practitioners are generally pleased to see someone from their ranks selected to helm the IRS. Capitol Hill reaction also was positive. "With a long history of helping families and job creators navigate the tax code and stand up to the IRS when the agency is wrong,... Read more →


We did it! We made it through the wild ride that was 2017. It ended in a particularly chaotic fashion, with a major tax bill that was literally written on the fly even on its last day of Congressional consideration. via Giphy.com Studios Now it's time to hunker down for what 2018 has to throw at us on the tax front. However, before we dive head-first into the new year, I'm taking one of the 365 days, just like I did at the start of 2017, to list my top 10 tax stories from the previous year. These are not... Read more →


Before you can write off your business expenses, you must show that you were indeed trying to turn a profit. That basic business tax tenet was confirmed by a recent U.S. Tax Court decision. In a summary opinion, Special Trial Judge Daniel A. Guy, Jr., sustained the Internal Revenue Service’s accuracy-related penalty against Eric Zudak based on tax that was reduced by incorrect business expenses claims. The judge held that Zudak wasn’t entitled to a deduction for expenses he paid for his film festival activity because he didn’t conduct the activity in a businesslike manner or engage in the activity... Read more →


India tax officials say their effort to reduce large stashes of illicit cash has led to markedly more tax compliance. Such efforts to get more taxpayers to be honest are ongoing globally, including by the Internal Revenue Service here in the United States. 500 and 1000 Rupee notes that were recently demonetized by the Indian government. It’s no secret that the Internal Revenue Service looks much more closely at business that are cash heavy. The IRS, supported by other government studies, has found that cash intensive companies — which are, as the name indicates, businesses that receives a significant amount... Read more →


The Internal Revenue Service has expanded its digital options, offering email notification for some e-paying taxpayers and web video conferencing for appealing tax disputes. You have IRS email: Yes, this time that email really could be from the IRS. But only in certain circumstances. The IRS announced its new email notification for folks who pay via Direct Pay and Electronic Federal Tax Payment System (EFTPS) in, what else, an email. The July 21 electronic message to tax professionals let them know that their clients who use those two payment options can sign up to get notifications about those payments in... Read more →


Happy World Emoji Day! It's held on July 17 each year as a way to promote the use of emojis — like we need to do that! — and, according to Emojipedia (really!), spread the enjoyment that the colorful icons bring. The enjoyment goal got me thinking of how emojis might make one of our worst tax tasks more pleasant. I'm talking, of course, about our annual filing of returns. Most of us already use tax software. Surely it wouldn't be that difficult to incorporate the option of adding emojis to the lines we fill electronically complete. Dressing up your... Read more →


Undefeated boxing champ Floyd Mayweather Jr. is trying to avoid a knockout from the Internal Revenue Service. Mayweather still owes the federal tax collector a reported $22.s million for his 2015 taxes. That year, Mayweather reportedly earned as much as $230 million for besting Manny Pacquiao in the heavily promoted Fight of the Century. Floyd Mayweather's official weigh-in before his 2015 fight with Manny Pacquiao in Las Vegas. Money earned on that match is at the center of an unpaid tax bill battle Mayweather's waging with the IRS. (Photo courtesy Pixabay via Wikimedia Commons) Rich, but tax cash poor: Mayweather... Read more →


Happy Mother's Day! What a perfect day to talk about tax audits. You don't see the connection? Then you missed the season finale last week of the CBS show "Mom." I'm not really a fan, but it was on in the background as we were fixing dinner. Scene from the May 11 season finale of CBS sitcom "Mom," where the characters portrayed by Anna Faris and Allison Janney consult an attorney, played by Leonard Roberts, about some tax trouble. (Photo courtesy CBS) But as I was chopping veggies I heard "the IRS put a lien on my account." So naturally... Read more →


One of the biggest taxpayer fears is being audited. Realistically, unless you're aggressively pushing the tax envelope, it's not something that should keep you up at night. That's not just my assessment. It's borne out by Internal Revenue Service data, which shows that the individual tax return audit rate in 2016 was just 0.06 percent. That's the fifth straight year audits (or examinations, as the IRS calls them) have dropped and the number of returns examined last year was the fewest since 2004. A key reason that audits have fallen is because the IRS is understaffed in this area. (More... Read more →


Let me make this very clear from the get-go. I never, ever, ever recommend that anyone cheat on his or her taxes. But if you're inclined to be a bit aggressive with your Form 1040 strategies, your odds of catching a tax examiner's eye are decreasing. The Internal Revenue Service's audit rate has been dropping for years and that trend likely will continue, due in part to more agency funding cuts in the latest federal budget proposal. Fewer audits yet again: Recently released IRS data shows that in 2016 the number of individual audits dropped for the fifth straight year.... Read more →


This post was updated March 22, 2018. Do you have to file a return? Don't shoot the messenger, but the answer usually is yes. If you are a U.S. citizen or resident who made money last year, whether you must tell the Internal Revenue Service about it depends on three things: Your gross income, Your filing status, and Your age. The IRS created the table (shown as Chart A in the 2017 Form 1040 instructions) below to give you an idea of whether you should start getting your filing material together. 2017 Filing Requirements for Most Taxpayers If your filing... Read more →


When Donald J. Trump assumed the U.S. presidency at noon on Friday, Jan. 20, he and his staff also took over the White House website. This is the only glimpse of Donald Trump's taxes the new president has provided, a photo via Twitter of him signing his purported 2014 federal return on Oct. 15, 2015. Although the 45th president's people made some major changes to the content Trump's predecessor had posted, they did leave one feature untouched, the We the People petition generator. This option lets people petition the White House for action on whatever is near and dear to... Read more →


America's 538 electors are meeting today in their state capitals to cast votes that will make the Nov. 8 presidential election official. Although a handful of electors vowed not to vote for Donald J. Trump despite their states' election results, The Donald is expected to garner received more than the 270 Electoral College votes needed to ensure he will become the 45th U.S. president next month. Click screen shot to view the ABC News/Good Morning America preview report on today's Electoral College vote. Crazy election cycle continues: The controversy surrounding the penultimate step -- the vote won't be final until... Read more →


The late Robin Williams said that cocaine is God's way of telling you that you are making too much money. I think you can add luxury autos to that list. The hubby and I spotted this McLaren MP4-12C in our local shopping center's parking lot. Note to self: get to know my obviously much wealthier neighbors! Here in Austin, I regularly see high-dollar cars. A lot of them. On just the roads I routinely travel I've spotted Teslas, Ferraris, Lamborghinis, Mercedes-Benz G-Wagons, Maseratis, Lotuses and even that McLaren pictured above. Yes, I am jealous. While I am happy with my... Read more →


It's official. We will not see Donald J. Trump's tax returns before we vote on Nov. 8. During an interview Oct. 30 on NBC's Meet the Press, Indiana Gov. Mike Pence, Trump's running mate, reiterated that Trump will not release his returns until after an audit is completed. This Twitter image of Donald J. Trump signing his 2014 return on Oct. 15, 2015, is probably the closest we'll get to seeing the Republican presidential candidate's tax filings. "All right, so not before the election?" host Chuck Todd asked. "Yeah," Pence replied. Breaking election tradition, again: If the Republican presidential nominee... Read more →


$10,162. That's how much of a federal tax refund that Republican vice presidential nominee Mike Pence and his wife Karen received on their 2015 tax return. Indiana Gov. Mike Pence, GOP vice presidential candidate, campaigning among Ohio State tailgaters during a stop earlier this month in the key Nov. 8 election state. (Photo via @mikepence Twitter account) Since the Pences' refund is almost four times the amount of the average tax refund of $2,732 (per Internal Revenue Service filing data through May 13), the $10,162 that the Pences are getting back from Uncle Sam also earns this week's By the... Read more →


"I can't define tax evasion, but I know it when I see it," Fred T. Goldberg Jr. once said. Fred Goldberg, in his capacity as Assistant Secretary of the Treasury for Tax Policy, the position he took immediately after leaving his IRS commissioner post, answers questions from the Joint Committee on Taxation in February 1992. (Click image to view the full video of the hearing via C-SPAN.) Now I'm not saying that Goldberg, commissioner of the Internal Revenue Service from 1989 to 1992, was thinking about his adaptation of the legendary Supreme Court "I know it when I see it"... Read more →


Warren Buffett is the third richest man in the world. He's also like a lot of us who are a whole lot poorer. Buffett wants to know what's on Donald J. Trump's tax returns. Warren Buffett challenges Donald Trump to a tax return face-off during a rally for Democratic presidential nominee Hillary Clinton in Omaha, Nebraska, on Aug. 1, Click image to watch the full CNN Money video. He's the third billionaire within a week to call on Trump to release his returns. Former New York City mayor and media mogul Michael Bloomberg and Mark Cuban, owner of the NBA's... Read more →


Work-related moving expenses are tax deductible. You don't even have to itemize. The claim is made as one of the adjustments to income, generally referred to as an above-the-line deduction, right on the long Form 1040. Vintage moving van | Alden Jewell via Flickr But don't think just because this is a relative easy tax write-off that the Internal Revenue Service will just give the claim a cursory glance. IRS examiners will be looking. Just as Giliard Schwartz. A really big move: The San Antonio, Texas, woman claimed $330,000 in moving expenses on her 2012 tax return. Instead of that... Read more →