Robert J. Fedor, Esq., L.L.C.

Key advice when dealing with taxes and the IRS

Aside from the fact that the word is pretty much synonymous with paying money, taxes are dreaded for another major reason; namely the fact that tax codes are convoluted and extremely confusing. Anyone who's ever attempted to prepare and file their own taxes can likely attest to experiencing some level of frustration and bewilderment. Given the difficulty that many people encounter when it comes to understanding tax rules and restrictions, there are some things that every taxpayer should know.

After Jan. 1, numerous tax-related documents begin flooding one's mail box in preparation for the April 15 tax filing deadline. Many people simply set these documents aside and present them to their tax preparer. It's important, however, to review these documents to ensure for their accuracy. In cases where an error is identified, an individual needs sufficient time to request an amended form from the payer.

If an individual discovers the error after taxes have been filed, it is possible to amend a tax return. Doing so, however, increases the likelihood of being targeted for an IRS audit. This is often especially true in cases where an amendment is in favor of a taxpayer and results in a sizable tax return. While it makes sense to correct the error, it's important to ensure that all errors are corrected and not just the one or ones that are to a taxpayer’s benefit.

In the case where an individual is the subject of an IRS audit, it's important to note that the IRS statute of limitations allows the agency to review tax-related documents for at least the last three years. In cases where the IRS discovers a taxpayer owes back taxes, the agency may seek repayment related to tax documents filed up to 10 years ago.

Individuals who are contacted by the IRS should proceed with caution. In cases where the IRS visits an individual in person seeking more information or answers, it's wise to direct any and all questions to one's attorney. Criminal tax charges are serious and any and everything an individual says to an IRS agent can, and likely will, be misinterpreted and used to build a criminal case.

Source: Forbes, "The Real 'Fifty Shades Of Grey' Is Dealing With IRS," Robert W. Wood, July 28, 2014

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