Saturday, January 26, 2008

Top 10 Tax Return Gaffes/Errors on taxes

As a general rule, taxpayer's should never prepare their own taxes. If you need IRS Help, there are companies out there that can ensure you that your returns will be processed in a timely fashion. Bare in mine that there are several commone mistakes that one could make when attempting to file their own tax returns:

What is a gaffe?
-A clumsy error
-A faux pas
-A blatant mistake or misjudgement
-Something that should not have been done

A Gaffe is a large hook with a sharp point used to grab large fish. I listed a couple of so called excuses or reason why taxpayer's forget to include mandatory information their tax returns.

#1-The Undereported Stock Sale-

In a case like this, you may hear where a client may say "I lost money on the stock". They become under the impression that it does not matter because the IRS does not physically see it reported. Therefore, it would be no way for them to get caught. In a case like this, a taxpayer may not realize that they need to allow for this cost basis in stock. Bare in mind there are two things that the taxpayer would need to provide: one being the purchase and the other being the price. Note, that the IRS would need to fix the IRP to show stock bases.

#2 The Omitted 1099-Misc

Client may say to the IRS that "they forgit to report their business income". Secondly they say that they thought it was in cash and not reportable.Lastly, the IRS may refute any change newly added expenses when its already reported as other earnings on Sch. C. Stay tuned for more information to come on Gaffes and Errors in tax reporting.

Not all tax attorney's and tax lawyer's can solve your needs for a tax resolution. There are licensed tax consultants out there that can provide information and resolutions because they deal with the IRS on a daily basis to provide the best outcome for you !

No comments: