IRS Tax Audit Defense, Individual, Business, Corporate = IRS Appeals Representation = Affordable Former IRS Agents = Tupelo, Oxford, Columbus, Corinth, Aberdeen

by Fresh Start Tax | Dec 9, 2014 | Tax Help

We are a full service tax firm that specialize in all IRS tax matters. We are the affordable and experienced LOCAL professional tax firm.

We have Former IRS Audit managers on staff that know the system.

On staff are former IRS agents that have logged  over 60 years of direct work experience in the local, district, and regional tax offices of the Internal Revenue Service.

We have worked in almost all positions as agents, managers, supervisors, teaching instructors and  almost all facets of Internal Revenue Service.

You can call us today for a free initial tax consultation.

If you are currently being represented you can call us for a second opinion.

So, what is an IRS audit?

An IRS audit is a review/examination of an organization’s or individual’s accounts and financial information to ensure information is being reported correctly, according to the tax laws, to verify the amount of tax reported is accurate.

IRS Publication 556, Examination of Returns, Appeal Rights and Claims for Refund explains the audit process in more detail.

When  IRS selects a tax return for audit does not always suggest that an error has been made.

Returns are selected using a variety of methods, including:

•    Random selection and computer screening – sometimes returns are selected based solely on a statistical formula.

•     Document matching – when payor records, such as Forms W-2 or Form 1099, don’t match the information reported.

•    Related examinations – returns may be selected for audit when they involve issues or transactions with other taxpayers, such as business partners or investors, whose returns were selected for audit.

IRS Tax Audit Methods
An audit may be conducted by mail or through an in-person interview and review of the taxpayer’s records.

The interview may be at an IRS office (office audit) or at the taxpayer’s home, place of business, or accountant’s office (field audit).

The IRS will tell you what records are needed. Audits can result in no changes or changes. Any proposed changes to your return will be explained.

IRS Tax Audit  Notification
Should your account be selected for audit, you will be notified in two ways:

•    By mail, or

•    By telephone

In the case of a telephone contact, the IRS will still send a letter confirming the audit. Please note, E-mail notification is not used by the IRS.

Your Rights During an IRS Tax Audit

Publication 1, Your Rights as a Taxpayer, explains your rights as a taxpayer as well as the examination, appeal, collection, and refund processes.

These rights include:
•    A right to professional and courteous treatment by IRS employees.
•    A right to privacy and confidentiality about tax matters.
•    A right to know why the IRS is asking for information, how the IRS will use it and what will happen if the requested information is not provided.
•    A right to representation, by oneself or an authorized representative.
•    A right to appeal disagreements, both within the IRS and before the courts.

Call us today for free initial tax consultation and speak directly to a former IRS audit manager who can explain and review the IRS tax audit process.

IRS Tax Audit Defense, Individual, Business, Corporate = IRS Appeals Representation = Affordable Former IRS Agents = Tupelo, Oxford, Columbus, Corinth, Aberdeen

Retirement Plan Distributions by Dec. 31= WHAT YOU NEED TO KNOW, IRS TAX EXPERTS

by Fresh Start Tax | Dec 8, 2014 | Tax Help

Most Retirees Need to Take Required Retirement Plan Distributions by Dec. 31

Fresh Start Tax LLC reminds taxpayers born before July 1, 1944, that they generally must receive payments from their individual retirement arrangements (IRAs) and workplace retirement plans by Dec. 31.
Known as required minimum distributions (RMDs), these payments normally must be made by the end of 2014.

But a special rule allows first-year recipients of these payments, those who reached age 70½ during 2014, to wait until as late as April 1, 2015 to receive their first RMDs.

This means that those born after June 30, 1943 and before July 1, 1944 are eligible for this special rule.

Though payments made to these taxpayers in early 2015 can be counted toward their 2014 RMD, they are still taxable in 2015.

The required plan distribution rules apply to owners of traditional IRAs but not Roth IRAs while the original owner is alive.

They also apply to participants in various workplace retirement plans, including 401(k), 403(b) and 457(b) plans.

An IRA trustee must either report the amount of the RMD to the IRA owner or offer to calculate it for the owner.

Often, the trustee shows the RMD amount on Form 5498 in Box 12b. For a 2014 RMD, this amount was on the 2013 Form 5498 normally issued to the owner during January 2014.

The special April 1 deadline only applies to the RMD for the first year. For all subsequent years, the RMD must be made by Dec. 31.

Example:

A taxpayer who turned 70½ in 2013 (born after June 30, 1942 and before July 1, 1943) and received the first required payment on April 1, 2014 must still receive the second RMD by Dec. 31, 2014.

The RMD for 2014 is based on the taxpayer’s life expectancy on Dec. 31, 2014, and their account balance on Dec. 31, 2013.

The trustee reports the year-end account value to the IRA owner on Form 5498 in Box 5.

Use the online worksheets on IRS.gov or find worksheets and life expectancy tables to make this computation in the Appendices to Publication 590.

For most taxpayers, the RMD is based on Table III (Uniform Lifetime) in the IRS publication on IRAs.

So for a taxpayer who turned 72 in 2014, the required distribution would be based on a life expectancy of 25.6 years.

A separate table, Table II, applies to a taxpayer whose spouse is more than 10 years younger and is the taxpayer’s only beneficiary.

Though the RMD rules are mandatory for all owners of traditional IRAs and participants in workplace retirement plans, some people in workplace plans can wait longer to receive their RMDs.

Usually, employees who are still working can, if their plan allows, wait until April 1 of the year after they retire to start receiving these distributions.

See Tax on Excess Accumulations in Publication 575. Employees of public schools and certain tax-exempt organizations with 403(b) plan accruals before 1987 should check with their employer, plan administrator or provider to see how to treat these accruals.

Retirement Plan Distributions by Dec. 31=  WHAT YOU NEED TO KNOW, IRS TAX EXPERTS