Failing to report income on your taxes can lead to penalties and interest charges from the IRS. It’s crucial to accurately report all sources of income to avoid potential legal and financial consequences. Consequences of Unreported Income IRS Recalculation: The IRS may recalculate your tax return, including the unreported income, resulting in additional taxes, penalties, … Read more
A final audit, also known as a periodic audit, is an examination of an organization’s financial statements and records performed after the end of an accounting period, typically at the end of a fiscal year. The primary objective of a final audit is to provide assurance that the financial statements are accurate, complete, and presented … Read more
Filing taxes is a crucial obligation for individuals and businesses alike. However, there may be instances where individuals fail to meet the tax filing deadline, leading to potential penalties and consequences. This article delves into the implications of not filing taxes, exploring the penalties associated with late filing and non-filing, and providing guidance on how … Read more
Underpayment penalties are imposed by the Internal Revenue Service (IRS) on individuals who fail to pay sufficient estimated taxes or make timely payments. These penalties can add up quickly, increasing your tax burden and causing financial strain. Fortunately, there are several strategies you can employ to avoid or remove underpayment penalties, ensuring you meet your … Read more
An IRS audit is a review or examination of an organization’s or individual’s accounts and financial information to ensure that the information reported on tax returns is accurate and that the reported amount of tax is correct. The IRS conducts audits to verify the accuracy of tax returns and to ensure compliance with tax laws. … Read more
Investing in stocks is a common way to grow your wealth, but it’s important to be aware of the tax implications of your investment decisions. One of the most important taxes to understand is the capital gains tax, which is levied on profits from the sale of stocks and other capital assets. In this guide, … Read more
Understanding the Third Stimulus Check In 2021, the American Rescue Plan Act authorized a third round of Economic Impact Payments, commonly known as stimulus checks, to provide financial relief during the COVID-19 pandemic. These payments were distributed to eligible individuals and families to help offset the economic impact of the pandemic. Eligibility Criteria To be … Read more
The backdoor Roth IRA is a strategy that allows individuals to contribute to a Roth IRA even if they exceed the income limits for direct contributions. This strategy involves making a non-deductible contribution to a traditional IRA and then converting it to a Roth IRA. Legality and IRS Recognition The backdoor Roth IRA is a … Read more
Filing taxes can be a complex and daunting task, and mistakes can happen. If you realize you’ve made an error or omission on your tax return after filing, don’t panic. The Internal Revenue Service (IRS) allows taxpayers to amend their returns using Form 1040-X, Amended U.S. Individual Income Tax Return. This guide will provide a … Read more
When you file your tax return, you may anticipate receiving a specific refund amount based on your calculations. However, in some cases, you may receive a refund that is lower than expected. This can be a frustrating experience, but it’s important to understand the potential reasons why your refund may not match your expectations. Tax … Read more