We don't want to sugarcoat things: Getting hit with an IRS "field audit" is a worst-case scenario and a cause for genuine concern. The process is expensive, time-consuming and requires a more comprehensive defense strategy than the other two types of audits we've discussed in our audit series ("correspondence audits" handled through the mail and "office audits" performed at an IRS office).
Small Business Tax
Section 179 vehicles should be a key part of your small business tax deduction strategies. Can Section 179 property fit in with your business tax strategies?
Let Business Management Daily help you get each and every rental property depreciation credit and business tax deduction you’re entitled to.
During an audit, chances are that you won't be able to produce all the receipts, bills or other pieces of written information you'll need to back up your claims, especially if the audit comes several years after the tax year in question.
In the waning days of summer, President Bush signed the highly anticipated Energy Tax Incentives Act of 2005. The massive new energy law contains almost $15 billion in tax cuts designed to encourage conservation, expand domestic energy production and develop alternative energy sources.
Q: I'm still confused about guaranteed withdrawal benefits and guaranteed monthly income benefits available with some variable annuities. I am interested in the guaranteed monthly income benefit. Can you explain the difference? V.G., via e-mail
Do your employees need special tools for their jobs? Typically, you provide the tools that workers need or you reimburse employees for tools they must buy on their own. If you handle everything correctly, those reimbursements are tax-free to employees and tax-deductible for you.
Q: If I inscribe the name of my business on the side panels of my car, can I write off the full cost of my car expenses? My accountant isn't sure. L.D., West Mifflin, Pa.
With gasoline prices shooting through the roof, the IRS took the unusual step last month of increasing the standard mileage rate deduction for the final four months of the year.
Starting in 2006, taxpayers will be able to give cash gifts of up to $12,000 to each recipient without facing gift-tax issues. That's up from $11,000 this year. Married couples can give twice as much.
"Passive activity loss" (PAL) rules say that losses from passive activities are limited to annual passive activity income. In general, rental real estate is treated as a passive activity.
Q: My daughter is a college freshman and I bought her a new laptop through the school. Does that qualify for a tax-free withdrawal? C.K., Syracuse, N.Y.