Welcome to the Tax Tips and Insights series of First Response Resolution, LLC’s official blog! We are a specialty tax firm practicing right here near Medford in Southern Oregon. The focus of my practice is solving tax problems for individuals and businesses, IRS Representation of taxpayers, and representing taxpayers before their individual State Departments of Revenue. We offer our services online nationwide from the comfort of our client’s homes and will provide services on-site to businesses in our area upon request. Think of our firm as your Financial First Responders who specialize in saving troubled taxpayers. We help people who are struggling with tax problems get their lives back on track so they can focus on what matters most to them.
Happy St. Patrick’s Day everyone! In this post we wrap up our conversation addressing this common question from taxpayers: When can I stop filing my tax returns? Our previous posts touched on the issue of whether you have a filing requirement, covered the issue that there is no set age when tax returns are no longer required to be filed, and pointed out some tools the IRS provides to determine if a filing requirement exists. This final post comes to our recommendation on the subject and some of the rationale. We would never recommend that a taxpayer who has a filing requirement decide to intentionally not file their tax return. The penalties and interest that can be imposed are one thing, but we are only talking about money in that case. Freedom is an entirely different conversation when the IRS asserts criminal intent to evade taxes. The IRS can levy funds, including social security, and file liens against assets. This is when people usually decide that they need to address the issue. The IRS can also prepare your tax return for you, known as a Substitute for Return, which is generally not in your best interest. If the IRS prepares your return, they will likely use your highest marginal tax rate and won’t be concerned with including deductions you would otherwise be entitled to if you had filed yourself.
We can certainly understand the position that having to pay a tax preparer each year to file taxes is an inconvenience, but having to pay a competent representative when the IRS comes knocking at the door will cost far more than any tax preparation fees. As the old saying goes, an ounce of prevention is worth a pound of cure. The best advice we can give other than making sure you file your taxes timely, even if you don’t have the money to immediately pay an amount owed, is to make sure that the money spent on tax return preparation yields the best possible results allowable under the tax laws. Many tax preparers do not spend the proper time and due diligence to interview their clients thoroughly to ensure that they pay the smallest amount of taxes legally permissible. Many taxpayers also may not be properly responding to and entirely answering the questions in the tax organizer they receive from their preparers each year. We recommend that you keep diligent contemporaneous records of any deductions that you claim on your tax returns so that you have a solid defense in the event of an audit. If additional tax is assessed in an audit, the same penalties and interest apply all the way back to when the tax was owed. Recent tax law changes under the Tax Cuts and Jobs Act (TCJA) eliminated many deductions that taxpayers were accustomed to taking. It is important to refer to current tax law and IRS publications to ensure proper deductions are claimed.
If you have been obtaining properly prepared recent tax returns from a licensed professional, and your sources of income remain the same, you can file your taxes yourself through companies like H&R Block or TurboTax for much cheaper and use your prior returns and IRS Publications as a guide. The IRS also has free filing options for taxpayers who earn less than $73,000 a year: https://www.irs.gov/filing/free-file-do-your-federal-taxes-for-free. Many people do not actually require the expertise of a high paid CPA to address their returns.
If you or someone you know is in the midst of an IRS issue, contact me at either 541-293-8449, by email at email@example.com, or through our website. We specialize in solving tax problems! We will thoroughly investigate and evaluate your specific situation and consider ALL OPTIONS available to you. All discussions are kept strictly confidential, and we offer no obligation initial consultations of up to one hour.
Is your agency interested in having me speak to your team of realtors in person or over Zoom at one of your weekly sales meetings free of charge? I have a presentation developed to address the following:
- Taxation and your clients,
- Tax tips for saving on your own tax returns, and
- Tax Problem Solutions.
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