Many taxpayers are intimidated by the IRS. And there is a great deal of fear circulating in regards to the agency. But in addition to the legitimate fears and concerns, there is a great deal of misinformation concerning the IRS as well. Today, we are going to examine five of these common IRS myths:
1) An audit always means penalties and interest. Nobody ever wants to be audited by the IRS. But the truth is that many IRS audits actually end up with the taxpayer receiving a check from the government, because the taxpayer overpaid. As long as youâ€™ve filed your tax returns properly, thereâ€™s no reason to worry!
2) Only the wealthiest taxpayers and businesses are at risk for an audit. The IRS looks for certain â€śred flagsâ€ť in a tax return which increase the likelihood of an audit, but every single taxpayer faces the possibility of an audit. So donâ€™t try to â€śget awayâ€ť with anything illegal just because you think that the IRS wonâ€™t audit your return.
3) If youâ€™re going to be audited, you will find out quickly. Some believe that once the IRS processes their tax return, they are â€śout of the woodsâ€ť as far as an audit is concerned. In fact, the IRS can audit your return up to three years after you filed it â€“ and sometimes even later. So keep your records, just to be safe.
4) Not responding to IRS correspondence will cause the problem to go away. Many taxpayers seem to think that ignoring IRS correspondence will cause the problem to resolve itself. This couldnâ€™t be farther from the truthâ€”the longer you ignore the issue, the worse off you will be. Take action and resolve your IRS disputeâ€¦ we can help!
5) The IRS is all-powerful. The IRS can levy your bank account. It can seize assets, even cars and homes. But itâ€™s not all-powerful. It must comply with the law. If youâ€™re facing an IRS dispute, you still have rights.
Would you like to learn more? Or do you need help resolving an IRS dispute? Contact us today and let us help!