When a return is filed with a lot of incorrect information, this can be a large red flag and the IRS will want to look at the person’s tax situation more closely.
Charlotte, NC – The government does a number of different things to verify the information on a person’s tax return and make sure it is done properly. In a general sense, this is meant to ensure that the government is getting the money they are owed and people are not trying to cheat on their taxes. However, there is also the possibility that complexities with a person’s taxes cause a number of issues that require review by lawyers or other tax professionals. Here are some reasons why a return may be examined more closely.
Issues with deductions
People are allowed to deduct certain costs and expenses to try to save on their overall tax burden. However, this system is easily abused, as a person can simply claim very large and unreasonable deductions to try to avoid paying their taxes. The IRS routinely flags returns that seem to have excessive deductions or misrepresentations of deductions. If the IRS is conducting an audit or investigating a person for these reasons, they should speak with Charlotte tax lawyers as soon as possible.
Tax credits
There are good reasons why certain individuals claim credits such as the earned income tax credit or the advance child tax credit. In many cases, people may make mistakes and claim these credits when they are not eligible or they may just try to claim them because they think it will save money. North Carolina tax lawyers sometimes handle situations where a person is being audited for inappropriate claims related to a tax credit.
Not reporting all income
The IRS gets records of every time a person is paid out by their employer or a business. This counts as income and it needs to be reported. However, some people may forget to report all of these income sources, or they may intentionally underreport to avoid paying all of their taxes. If the IRS notices these kinds of income discrepancies, they may conduct an audit or take other actions. Tax Lawyers may even have to defend clients against criminal charges if it gets to the point where the person has intentionally lied about their income to defraud the IRS.
Exterior of the Internal Revenue Service office in midtown New York; Matthew G. Bisanz, CC BY-SA 3.0, via Wikimedia Commons, no changes.Returns that are incorrect
Estate planning lawyers and other professionals should be retained by anyone who is unsure about laws and regulations related to their taxes and filing status. When a return is filed with a lot of incorrect information, this can be a large red flag and the IRS will want to look at the person’s tax situation more closely.
Additional tax law advice in Charlotte and other cities
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