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Why You Should Make Sure to Furnish Correct Information to the IRS

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www.longislandtaxresolution.com

Call us at: 631-244-1650

1) Thing to Be Aware Of Before You File Your Income Tax Returns

• Getting ready to file your income tax returns for the year?

• Do you owe a large amount of income taxes and are wondering why it’s so high?

• There are many possibilities as to why you owe a significant amount to IRS.

• It could be because of multiple incomes, if you are a business owner with various other income generating ventures.

• Owners of offshore accounts and assets need to be wary too.

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2) With all of this information you’re furnishing to the IRS, missing a few items won’t hurt, right?

• It is "wrong" to assume that missing some information won't hurt.

• The IRS views withheld information very seriously.

• It is not wise to withhold information or provide incorrect information

• The information you furnish to the IRS isn’t their only way to verify information about you.

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• The IRS has connections with banks, financial investment firms, and other government agencies.

• To put it concisely, nothing stays hidden from the IRS.

• Audits are the most potent tool in the IRS’s arsenal.

• Computer programs are designed to spot any inaccuracies and discrepancies in taxpayer returns.

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3) There are four noteworthy systems of this type:

• The Discriminant Function System (DIF)

• The Unreported Income Discriminant Function (UIDIF)

• The Information Returns Processing System (IRP)

• Audits of Related Entities

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4) The Discriminant Function System (DIF)

• DIF is a computerized system that analyzes each tax return on the basis of several factors.

• The higher the score, the more accurate the return is thought to be.

• Tax returns with low scores are flagged red.

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5) The Unreported Income Discriminant Function (UIDIF):

• UIDIF is another computerized system.

• It checks whether a taxpayer is spending more than he or she is earning.

• If so, it raises doubts about an unreported income source.

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6) The Information Returns Processing System (IRP):

• The IRS has a huge database of third parties.

• They provide tax-related information, like employers, brokerage firms and banks to IRS.

• The IRS cross-checks information from tax returns.

• The IRS will initiate an Audit if anything seems out of place.

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7) Audits of Related Entities:

• The IRS will initiate an audit if it finds that information was indeed wrongly reported.

• The IRS also can also audit anyone who is related to the taxpayer.

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8) Hiding or Furnishing the Wrong Information to IRS gets you nowhere

• As technology advances, hiding or furnishing the wrong information will get you nowhere.

• It will become more difficult to escape the purview of the IRS.

• Evading high taxes comes with the risk of many types of penalties.

• Also, the IRS may initiate criminal proceedings against the taxpayer.

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9) Failing to provide the correct information or ignoring it entirely can result in:

• Up to 3 years in prison

• Up to $250,000 in fines ($500,000 for corporations)

• Seizure of assets and property

• Seizure of bank accounts, deposits, insurance accounts, retirement funds

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10) Discrepancies in Filing Tax Related Information Results

Any discrepancies in filing tax related information can result in extremely high penalties.

Defaulting taxpayers with significant assets and accounts can be charged penalties of up to 40% of taxes owed.

The penalty amount may run into many thousands of dollars.

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11) You Can Avoid These Dire Consequences

• Pay taxes on time and in full, and provide the correct information to the IRS.

• Taxpayers should not withhold any information from the IRS.

• Are you in doubt about how much you should reveal to the IRS or how you should go about doing it?

• Seek certified tax professional Help and they will advise you

Call us at: 631-244-1650

12) A Few Simple Steps Will Keep You Out of Trouble

• Pay taxes on time.

• Settle everything you owe as soon as possible.

• It will keep both you and the IRS happy.

• Trying to cut corners during the preparation phases of tax returns can cause much more trouble than it’s worth.

Call us at: 631-244-1650

13) Contact Long Island Tax Resolution Services Today

• We are Certified Tax Professionals and we will advise you how to furnish correct tax information to the IRS and save yourself from severe IRS penalties.

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