The first thing every tax payer fears is communicating with the IRS, especially if they have been chosen for an audit. Here are a few things to keep in mind while corresponding with the IRS:

Contacting the IRS
If you ever need to call the IRS, make sure that you get the ID number of the IRS employee, their name, the date of the call, the time of the call, and write down the question and the answer. If something happens and it turns out that the IRS employee gave false information and you can provide this information, then the IRS will more than likely waive the penalty.

Appeal Rights

One tool that taxpayers have at their disposal is the right to appeal. If you disagree with the amount of your tax liability you have the right to ask the IRS Appeals Office to review your case. You could also appeal other things such as:

  • A collection action such as liens, levies, seizures, installment agreement terminations, and rejected offers-in-compromise.
  • Penalties and interest.
  • Employment tax adjustments and the trust fund recovery penalty.

Appeals conferences are informal meetings. The local Appeals Office, which is independent of the main IRS office which proposed the disputed action, can sometimes resolve an appeal by telephone or through correspondence.

Amend Errors
Every now and then someone makes a mistake on his or her taxes. When a mistake is discovered, an Amend or correction must be filed (within 3 years of the first return) using Form 1040X. Sometimes, the IRS will correct minor mathematical errors that can occur. If this happens, an Amend is no longer necessary. Amends should only be filed if your filing status has changed, your total income isn't correct, or your deductions or credits aren't correct.

What to Do If Last Year s Tax Return Hasn't Been Filed
Tax returns should always be filed as soon as possible, even if it was for a previous year. There is always someone in the IRS to help you if you need to file a late return. Don't make the mistake of thinking the IRS will overlook or forget about you. If you owe taxes, they will collect one way or another. If you end up owing money on a tax return that is filed late, expect to receive a penalty on top of the money that you owe. On the other hand, if you will be receiving a refund on your late taxes, you only have three years from the time of the original due date until you lose your refund completely.

Avoid Common Errors in Tax Returns

  • Check only one filing status, enter the right number of exemptions that you are claiming and make sure the required information is included.
  • Use the correct tax table column for your status.
  • Double-check everything. (figures, dates, social security numbers, etc.).
  • Make sure all the required signatures are on the form.
  • Attach all required forms. (schedules, W-2, W-2G, 1099-R, 9465, etc.)
  • Enclose the check if you owe money to the IRS.
  • Make sure that your tax return is filed on time. (Electronic filing will ensure that your taxes aren't lost in the mail)

If you fail to complete any of these steps, your tax form and refund might be delayed. Remember that if you have to file your return late, make sure that you file a request for an extension (Form 4868) to avoid a penalty or late fee. Also, be sure to check out our online tax software review for software designed to make filing your taxes a piece of cake.

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