IRS Audit Overview

Pre-audit Analysis
An in-depth pre-audit analysis is essential to conducting a quality examination. IRS Examiners, Revenue Agents, should prepare a comparative analysis of the taxpayer’s returns for multiple years to assist in the identification of:

• large, unusual and questionable items,
• missing schedules, statements and/or elections
• inconsistencies between different years, and
• audit potential.

A successful IRS taxpayer audit depends upon what is done before the interview. The IRS examiner should obtain as much information about the taxpayer, be organized, and prepare an interview outline that is tailored to the taxpayer under examination. As preliminary information is gathered, it should be carefully reviewed and documented for the IRS tax audit.

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An offer in compromise (OIC) is an agreement between a taxpayer and the Internal Revenue Service (IRS) that settles the taxpayer’s tax liabilities for less than the full amount owed. Absent special circumstances, an offer will not be accepted if the IRS believes that the liability can be paid in full as a lump sum or through an installment agreement.

In most cases, the IRS will not accept an OIC offer in compromise unless the amount offered by the taxpayer is equal to or greater than the reasonable collection potential (RCP). The RCP is how the IRS measures the taxpayer’s ability to pay and includes the value that can be realized from the taxpayer’s assets, such as real property, automobiles, bank accounts, and other property. The RCP also includes anticipated future income, less certain amounts allowed for basic living expenses.

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Updated 9/02/11 to reflect expanded federally declared disaster area.

The Internal Revenue Service is providing tax relief to individual and business taxpayers impacted by Hurricane Irene.

The IRS announced today that certain taxpayers in North Carolina, New Jersey, New York, Vermont and Puerto Rico will receive tax relief, and other locations are expected to be added in coming days following additional damage assessments by the Federal Emergency Management Agency (FEMA).

The tax relief postpones certain tax filing and payment deadlines to Oct. 31, 2011. It includes corporations and businesses that previously obtained an extension until Sept. 15, 2011, to file their 2010 returns and individuals and businesses that received a similar extension until Oct. 17. It also includes the estimated tax payment for the third quarter of 2011, which would normally be due Sept. 15.

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When it comes to filing a tax return, or not filing one, the IRS can assess a penalty if you fail to file, fail to pay or both. Here are eight important points the IRS wants you to know about the two different penalties you may face if you do not file or pay timely.

If you do not file by the deadline, you might face a failure-to-file penalty. If you do not pay by the due date, you could face a failure-to-pay penalty.

The failure-to-file penalty is generally more than the failure-to-pay penalty. So if you cannot pay all the taxes you owe, you should still file your tax return on time and explore other payment options in the meantime. The IRS has options such as payment plans, offer in compromise, and other options.

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We provide IRS tax help, tax relief, tax resolution and IRS audit representation in the South Florida Metro area of Miami, Miami Beach, Hialeah, Kendall, Fort Lauderdale, Pembroke Pines, Hollywood, Miramar, Coral Springs, Miami Gardens, Pompano Beach, Deerfield Beach, West Palm Beach, Boca Raton, Boynton Beach, Miami Dade county and Broward county of Florida.

The IRS has identified many individual and business taxpayers who fail to file income tax returns (1040 for individuals and 1120 for corporations) and employment tax returns (940 and 941) and these taxpayers have effectively stopped paying federal taxes as a serious matter to the US tax administration and the American economy as a whole. The IRS is actively pursuing non-filers owing back taxes with aggressive enforcement of the tax laws by issuing record numbers of tax levies and tax liens.

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Tax Relief – Tax Debt Relief – IRS Tax Relief – Tax Relief and tax resolution

ST. LOUIS — Victims of flooding beginning on June 1, 2011, in parts of Missouri may qualify for tax relief from the Internal Revenue Service.

The President has declared Andrew, Atchison, Buchanan, Holt, Lafayette and Platte counties a federal disaster area. Individuals who reside or have a business in these localities may qualify for tax relief.

As a result, the IRS has postponed until Aug. 1, 2011, certain deadlines occurring from June 1 to Aug. 1 that affect taxpayers who live or have a business in the disaster area. This includes the June 15 deadline for making estimated tax payments.

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The Internal Revenue Service today encouraged business taxpayers, associations and other interested parties to submit to the Industry Issue Resolution (IIR) Program tax issues for resolution involving a controversy, a dispute or a potentially unnecessary burden on business taxpayers. You can contact a licensed IRS problem solver such as an EA Enrolled Agent, CPA, tax attorney or a tax lawyer.

You can contact Mike Habib, EA at 1-877-788-2937, he is an experienced IRS tax problem solver and can represent taxpayers in all 50 states. The objective of the IIR program is to resolve business tax issues common to significant numbers of taxpayers through new and improved guidance. In past years, issues have been submitted by associations and others representing both small and large business taxpayers, resulting in tax guidance that has affected thousands of taxpayers.

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IRS Reminds Taxpayers that the Aug. 31 Deadline Is Fast Approaching for the Second Special Voluntary Disclosure Initiative of Offshore Accounts

U.S. taxpayers hiding income in undisclosed offshore accounts are running out of time to take advantage of a soon-to-expire opportunity to come forward and get their taxes current with the Internal Revenue Service.

The IRS today reminded taxpayers that the 2011 Offshore Voluntary Disclosure Initiative (OVDI) will expire on Aug. 31, 2011. Taxpayers who come forward voluntarily get a better deal than those who wait for the IRS to find their undisclosed accounts and income. New foreign account reporting requirements are being phased in over the next few years, making it ever tougher to hide income offshore. As importantly, the IRS continues its focus on banks and bankers worldwide that assist U.S. taxpayers with hiding assets overseas.

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First and foremost, you must respond to any IRS Notice.

If you receive a letter or notice from the IRS, it will explain the reason for the correspondence and provide specific instructions. Many of these letters and notices can be dealt with simply, without having to call or visit an IRS office.

The notice you receive covers a very specific issue about your account or tax return. Generally, the IRS will send a notice if it believes you owe additional tax, are due a larger refund, if there is a question about your tax return or a need for additional information.

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