IRS notices, audits and penalties, these are all tax problems that can make small business owners pull their hair out with frustration, but ignoring them and not tackling them in time, can be even more stressful and annoying.
Below are some of the most common tax problems business owners face every year:
- Penalties – did you know that the IRS charges more than 40 million penalties every year!
- Audits – with some audits lasting well over a year, approximately 1.4 million take place each year
- CP2000 or underreporting notices – with an average of 4 million taxpayers receiving these notices every year, they’re automatically sent out when income reported on tax returns doesn’t accurately match the information the IRS gets from employers and other payers, triggering an explanation requirement and proposal for additional taxes.
- IRS bills – with a whopping 17 million taxpayers owing the IRS money they can’t pay; tax bills are a huge problem.
- Tax identity theft – with personal information being stolen at an alarming rate, taxpayers who’ve fallen prey to identity theft risk a false return being filed in their name by the fraudsters the following year.
- Unfiled returns – millions of taxpayers fail to file their required returns each year.
While it may be true that some IRS issues can take a long time to resolve, if you heed the following advice, you can help ensure that when a new year tax arrives, you’re not left with lingering issues from the previous year:
Understand what exactly happened, and why:
Getting to the underlying cause of your IRS problem is essential to resolving it, and you can research this using your IRS account.
Select the best option to remedy it:
There may be a range of solutions to fix the problem, but choosing the best one requires a little research and a deeper understanding of the issue at hand. Talking to a tax specialist or professional accounting agency can help you determine this.
Don’t hang around!
Once you’ve made the positive decision to tackle your issue, get in touch with the IRS right away and help them to determine the facts and avoid any miscommunications. Deadlines set by the IRS should be met wherever possible to avoid a premature decision based upon your situation. Even if you’ve already missed a deadline, you should still take steps to resolve the problem.
For all your tax concerns and IRS notices, take prompt action to mitigate the consequences and prevent any possible repercussions from occurring the following year.
If you’re struggling to keep up with your tax and accounting commitments, simply engage with an agency who can help make sure the IRS are your friends, not your foes!