Tax Law

An IRS audit: few things strike as much terror in the hearts of small business owners than this simple phrase. You try to do your taxes accurately and on time, or maybe you have an accountant to prepare your taxes on your behalf. Though mistakes can happen, there are a few areas that are the more likely than others to trigger a visit from the IRS auditing staff. Below are five such triggers you’ll want to avoid if at all possible when preparing your taxes.

1. Simple errors. Simple errors, like writing your Social Security number on your return incorrectly can bring your return to the attention of the IRS auditors. Likewise, mathematical errors on your return, especially in totaling your income, can bring on an audit.

2. High income. Do you report more than $1 million in earnings? Prepare for an audit. According to the IRS, an average of 8.5 percent of the people in this income bracket will be audited.

3. Home office deduction. If you truly use your home office exclusively for business be prepared to prove it. This often-misused deduction can also trigger an IRS audit. So, if your office is also your guest bedroom, maybe you want to rethink taking this deduction.

4. Reporting incorrect income. Did you remember to report all of your income? The IRS gets a copy of all W-2 and 1099 forms. The IRS compares these documents on a random basis to income reported on tax returns. If there’s a discrepancy, expect an audit. Because of this, if you receive an inaccurate tax document, be sure to get it corrected before you file your taxes.

5. Certain industries. Those who work in some industries, primarily those that deal in cash, like beauty salons, home contracting and restaurants, are more likely to be audited than those who work in other types of jobs.

Taxes are a fact of life. Knowing which areas of your return are likely to draw the attention of the IRS can help you prepare for next year.

For more information on your tax return and charitable donations, visit www.irs.gov. Please contact our office at (941) 906-1231 for an initial consultation if you need legal advice.

 There are many of tax advantages to being a resident of the State of Florida:

1.No state inheritance tax

2.No Florida state income tax

3.Can declare Florida residence as homestead.

4. Discount on real estate tax means first $50,000 tax free and a 3% annual cap

5. Plenty of sunshine to enjoy!

If you need legal advice for estate planning, Asset Protection Planning, or tax planning, please contact our office at (941) 906-1231 for an initial consultation.

As part of the administration’s efforts to bring all available resources to bear to support state and local partners impacted by Hurricane Sandy, the Treasury Department and the Internal Revenue Service today announced that an expedited review and approval process will be offered for organizations seeking tax-exempt status in order to provide relief for victims of Hurricane Sandy. The IRS also continues to encourage people to use existing organizations currently working on immediate aid efforts.

Organizations should apply for tax-exempt status by filing IRS Form 1023 and write at the top of the form “Disaster Relief, Hurricane Sandy.” The IRS will give such applications expedited attention and ensure they meet the legal requirements for tax exemption. Organizations seeking to provide relief for victims of Hurricane Sandy that have already submitted an application can fax a request labeled “Disaster Relief, Hurricane Sandy” that includes the organization’s name, Employer Identification Number, contact name and phone number to 513-263-4554 in order to be given the same expedited handling.

The IRS reminds people that existing charitable organizations, including churches and other places of worship, are frequently able to administer relief programs more efficiently than newly formed organizations, since they tend to already have fund-raising and distribution infrastructures in place.

The web site of the Federal Emergency Management Agency (FEMA) offers a list of organizations that provide support to victims of Hurricane Sandy.

For more information on your tax return and charitable donations, visit www.irs.gov. Please contact our office at (941) 906-1231 for an initial consultation if you need legal advice.

As part of the efforts to bring all available resources to bear to support state and local partners impacted by Hurricane Sandy, the Treasury Department and the Internal Revenue Service today announced special relief intended to support leave-based donation programs to aid victims who have suffered from the extraordinary destruction caused by Hurricane Sandy.

Under these programs, employees may donate their vacation, sick or personal leave in exchange for employer cash payments made to qualified tax-exempt organizations providing relief for the victims of Hurricane Sandy.

Employees can forgo leave in exchange for employer cash payments made to qualified tax-exempt organizations before Jan. 1, 2014. Under this special relief, the donated leave will not be included in the income or wages of the employees. Employers will be permitted to deduct the amount of the cash payment.

The IRS continues to monitor the situation and will provide additional relief related to Hurricane Sandy as needed.

For more information on your tax return and charitable donation, visit www.irs.gov. Please contact our office at (941) 906-1231 for an initial consultation if you need legal advice.