The line between a gift and income in the eyes of taxpayers is not always clear. A recent case, Felton v. Commissioner, provides an example. In this case, the Internal Revenue Service (IRS) argues a taxpayer’s claimed gift was actually income. As such, it would be subject to a higher tax rate.
As we enter tax season, it is good to keep in mind some common red flags that can trigger an audit by the Internal Revenue Service (IRS). Things that can increase the risk of an audit include:
Getting audited by the Internal Revenue Service (IRS)? You likely have a number of questions. The first may be along the lines of: is this for real? If you got a phone call stating you are getting an audit, it may be a scam. If, however, you received a letter from the IRS stating the agency is going to review your tax filings, the correspondence is likely legit.
Summer is coming to an end. This becomes apparent whenever you enter a big box store and see the shift of stock away from swimsuits and beach umbrellas towards backpacks and winter coats. But did you know that warm weather is not the only thing about to come to an end? There are also certain tax savings that will expire with the end of the summer season.
The Supreme Court of the United States (SCOTUS) has agreed to take on the issue of sales tax for online transactions. SCOTUS will decide whether or not a business is required to collect a state’s sales tax when the business has no physical connection to the state.
The new tax law has left taxpayers with many questions. One issue: how will the new tax law impact the business interest expense deduction?
Filing taxes is often a frustrating process. This frustration can grow exponentially in the event that a tax return triggers an audit by the Internal Revenue Service (IRS). You can mitigate the risk of becoming the target of an audit by becoming familiar with common triggers.
If you sell oil in Texas, you likely need to pay the Texas Automotive Oil Sales Fee. The application for the Automotive Oil Sales Fee states that everyone that either manufacturers and sells automotive oil in the state, imports oil into the state for sale, use or consumption or sells more than 25,000 gallons of automotive oil annually and owns a warehouse or distribution center in the state must file an Application for the Automotive Oil Sales Fee Questionnaire.
We are now in the thick of the Atlantic hurricane season, something many of us in Texas have to be concerned about, particularly if we own property along the Gulf. Of course, summer also frequently brings severe thunderstorms to our state, complete with damaging hail, straight-line winds, tornadoes and devastating lightning strikes.
In many cases, if someone is told that they will be audited, it can lead to a lot of stress. Not only was the whole process of filing taxes stressful and tedious, but now you have to go through all of the numbers again and be able to prove that they are accurate. If you get a notice of an audit, you might ask yourself “What did I do wrong?” In some cases, an audit is just a matter of chance. In other cases, though, some discrepancy may have triggered some questions from the IRS.