The more complicated (for lack of a better term) your tax situation is, the more likely you are to be audited. For example, sole proprietors, who must fill out and submit Schedule C documents to the IRS, are more likely to be audited than someone who only has to worry about W-2s.  The Schedule C form is where sole proprietors list profit or loss from their business. A universal truth of audits is that the IRS is Read More

Properly filing taxes can be a challenge even for seasoned financial professionals. This is especially true for business owners, those who have unusual deductions, or anyone filing joint tax returns. It is surprisingly easy for someone to do something incorrect—either accidentally or intentionally—to avoid paying taxes. In these circumstances, it is necessary to go back and pay the correct amount once the IRS Read More

That seemingly simple question does not have a simple answer. First, we must make it clear that no U.S. taxpayer is required, by law, to file an amended tax return for the purpose of fixing an earlier mistake. The Internal Revenue Code, which is the set of domestic tax laws governing nearly all aspects of federal tax law, provides that taxpayers “should” file an amended return and pay any tax due if they notice an Read More

How do you even begin to fill the federal government’s coffers without raising taxes? Well, one way is to enforce existing tax laws. Most experts agree that is a tall task for the IRS at its current funding levels, and it appears many in D.C. have been listening. The incentives are there and clear to anyone willing to look hard enough: every dollar “invested” in the IRS nets several dollars for the federal Read More

It’s been over a year since the first round of lockdowns cascaded across the U.S. in response to the now-ubiquitous novel coronavirus. It’s also been well over a year since the first round of the wildly popular Paycheck Protection Program went out to U.S. business owners. To date, nearly $800 billion of the program has been disbursed, and more than 10 million PPP loans have been approved.  Like the COVID-19 Read More

Between economic chaos, recent IRS letters, and Elon Musk’s hosting of Saturday Night Live on May 8, it certainly seems like the fervor over cryptocurrency has reached a fever pitch over the last few months. Those who filed tax returns this year noticed that a question about cryptocurrency was placed on Page 1 of Form 1040—the most prominent placement of crypto matters by the IRS.  We recently published a blog Read More

Whether you’re being investigated for a state misdemeanor or a potential federal felony, the process is likely to invoke intense stress for you and your family. The process for a federal criminal investigation is somewhat different than one for a state crime; notably, federal investigations involve grand juries and indictments. We explain more below.  Witness, Subject, and Target The three main players involved Read More

Though President Biden and his administration enjoy razor-thin advantages in Congress, the new crew in D.C. has not been shy about talking about new policy proposals that touch on many hot-button issues. One of these areas is tax policy; this was one of Biden’s central themes throughout his campaign, and his administration has been giving hints about specific policy changes Biden would approve.  Throughout the Read More

Take a global pandemic that forces millions of millennials to stay home with nothing but the internet and boredom to guide their behavior, and you get situations like the recent snafu with Robinhood and GameStop. Whatever your position on Robinhood’s decision to limit trading of certain securities and the ensuing outcry, the reality is that hundreds of thousands of U.S. taxpayers will need to get acquainted with Form Read More

The IRS received attention when it sent letters to thousands of taxpayers in August 2020 reminding them of cryptocurrency reporting requirements. That batch of letters was just one clue that the IRS is ramping up interest in bitcoin and other virtual currency. Sure enough, the first page of the updated 2020 Form 1040, Individual Income Tax Return, includes a question about acquiring “any financial interest in any Read More