Submitted your tax return? You should have, seeing that tax day just passed. For many taxpayers, it’s now the start of other problems ranging from the likelihood of an audit to penalties and interest charges. In my decades-long career in handling tax problems, I’ve come across myriads of tax return problems and devised countless solutions and strategies to overcome these problems for my clients. Now I’m going to share with you some of the most common tax return problems and their solutions for free. You will get access to the actual advise I have given my clients without paying a dime. Consider it my favor to you.
Here’s the first common tax problem I’d like to share – the fear of audits. You are afraid you will be flagged for an audit, so you avoid claiming any deductions, even those you are legitimately entitled to. Does that sound familiar? Read on.
Some so-called tax professionals will discourage you from making claims that are “too high” lest you trigger and audit. In reality, you should not do that. You would be doing yourself a disfavor because you would pay more taxes than you should be paying. All you have to do is claim every deduction you are legally entitled to claim and by doing so reduce your taxes to its lowest legal level. This way, you would never run the risk of an audit.
Here’s a little tip that I tell my clients who fear audits or who have been given the wrong information to avoid claiming deductions. Fill up IRS Form 8275, Disclosure Statement. This form is not found in the IRS' forms package simply because it actually helps you save on your taxes. IRS Form 8275 allows you to provide information with your tax return that answers any potential questions in the return. By filing Form 8275 along with your return, you give the IRS the answers to their questions even before your case is assigned for a face-to-face audit. How cool is that?
So all you have to do is use Form 8275 for any claim you feel may be considered “high” or questionable by the IRS. Now let me put the record straight. I am not saying you should use Form 8275 to claim any deduction you are NOT entitled to. That is not the purpose of Form 8275. It is to be used to facilitate claims to deductions to which you are legally entitled.