In 2019, the IRS assessed nearly $40.5 billion in civil penalties. Nearly $14.2 billion was assessed in civil penalties on individual, estate, and trust income tax returns. The causes and excuses are numerous and varied, but the one thing that is consistent that, no matter the underlying reason for the outstanding debt, the IRS will want their money. You could try to handle it yourself, although that may be what got you into the mess to start with, or you could receive help from a #1 rated tax relief company, Community Tax.
If you’re a freelancer or small business owner who finds yourself in this situation, rest assured that the situation can be resolved. It has been shown that returns from these types of businesses tend to be audited more frequently than large corporations as they are less regulated and often make more mistakes (whether honest or otherwise). Let’s start with defining some of the reasons that may red-flag you.
Overclaiming Home Office Deductions
Only the portion of your home in which work is actually being performed may be claimed. The IRS looks closely at this deduction, as it also allows the taxpayer to write off utilities and other expenses related to that portion of their home.
Claiming all Vehicle Expenses as a Business Deduction
As a freelancer or small business owner, it is likely that you use your own car for business, but the IRS will be very leery if 100% of the expenses are written off. Best to keep logs of your mileage for business use, with details about the travel purpose, and claim the mileage rate.
Claiming Losses Year after Year
While it is expected that a business will be in a loss situation for the first couple of years, if it doesn’t start to show a profit at some point, this could be a huge red flag for the IRS.
Generally speaking, anything that involves misrepresenting income, mixing personal and business finances, and misreporting expenses and deductions could land you in hot water.
Ideally, of course, you have avoided all these pitfalls, but if you find yourself in a situation where the tax burden becomes too much to bear, you can seek help. Whether you are a small business, or an individual, whether you are suffering financial hardships because of the pandemic or other reasons, whether you’ve just let things slide or are now too overwhelmed or scared to deal with the tax predicament you find yourself in, the worst thing you can do is ignore the problem—it will only get worse. Take the first step and contact Community Tax.
Community Tax is an affordable, ethical service that can assist you with many of your tax woes. If you are looking to settle large tax debts, prevent further penalties, or even want to have representation in front of the IRS, Community Tax can assemble a team of tax practitioners and CPAs to help. They will first consult with you, determine exactly what the concerns are, investigate the issues, and come up with a resolution that will leave you tax-debt-free. You will be kept informed throughout the entire process.
Through a variety of programs and drawing upon the expertise of their tax specialists, Community Tax can assist with tax liens, tax penalties and interest, and tax extensions. It can help negotiate payroll taxes, stop wage garnishment, and prevent levies and seizures. Whatever your tax issue, it can help to create custom tax solutions, to ensure that you receive the best relief package for your particular situation.
With an A+ rating from the Better Business Bureau and five star-ratings from Trustpilot, Google, and Consumer Affairs, you can rest assured that the service you will receive is not only honest, transparent, and trustworthy, but also costs less than most competitors.
Join the many happy customers who have sung praises with reviews such as “… they did what they said, and kept me updated along the way. My tax problem is over!” and “Excellent company to work with you and your taxes. I would recommend this organization …”
Let Community Tax be your tax hero.