The Internal Revenue Service (IRS) considers those with a total income higher than $200,000 to $250,000 to be high-income earners. Understanding your tax bracket is important in order to take advantage of tax-saving strategies. Research has shown that high-wealth individuals are more likely to evade paying their full tax liability. The difference between a legitimate attempt to save on taxes and tax fraud can sometimes be slim, which makes understanding your own tax practices important before you sign on the bottom line of your return.
Consider these tips for tax preparation this year:
The good news is that, despite its comments otherwise, the IRS has not been auditing high-wealth earners as assiduously as medium and low-income earners in recent years. High wealth returns are complicated and require business and tax expertise to review or audit. With increased funding, the IRS is likely to employ and train higher-level auditors to address this inequity, which may cause an uptick in audits of the wealthy.
One last tip for any taxpayer: If you use a new tax-preparer or tax accountant to prepare your returns, schedules, and filings this season, be sure to check their credentials, and ask for references to ensure your tax documentation is prepared legally and accurately. If you have questions, speak with an experienced tax attorney for guidance.
Representing local, national, and international clients from offices in Chicago and Cleveland, the tax attorneys at Robert J. Fedor, Esq., LLC can answer your questions about the IRS and provide strong representation on matters of criminal tax defense, FBAR issues, and other tax controversies. Call 800-579-0997 or contact us today.