Video instructions and help with filling out and completing Form 2220 Chooses

Instructions and Help about Form 2220 Chooses

Good morning good morning there we go they make sure the technology is working and of course if you're watching this recording feel free to skip ahead about a minute or two to get to the content thank you very much and when you hop on let me know who you are where you're from and while you're getting on I'm gonna share this out in a few places and keep it moving good morning whoo right let me share this out all right almost there and get one more place almost there oh my gosh that's hilarious okay all right okay there we go seems like my my phone is going to sleep but okay so there we go it has been shared out good morning and welcome to the show my name is lissandra Everett I am the home biz tax lady I help home business owners win the tax game by helping you keep more of the money you make in your pocket and paying less to Uncle Sam okay so today I want to talk about IRS penalties all right so here we go everybody was you know doing the happy dance when the administer current administration announced that they were cutting funding to the Internal Revenue Service right everybody's like whoo the IRS doesn't have as much money so they're not going to be able to do as much work well that's not true and why because of automation okay so let me give you some statistics in 2005 accuracy related penalties assessed were fifty eight thousand three hundred and sixty six so just a little over 58,000 right in 2014 in 2014 there were five hundred fifty four thousand four hundred and sixty seven accuracy related penalties assessed and this information comes to from the IRS data book so yeah so over nine years the accuracy related penalties have increased nine hundred fifty percent and you know so you know you actually self okay well is it that you know there's more unscrupulous tax payers or is it something else well I'm going with a little of both but a little more onto something outside meaning that automation is allowing the IRS to do its job better okay where normally it would require human intervention to find um you know to assess these penalties so findings and accuracy at inaccuracies now we got computers to do it so one of those things is called the autumn under reporter program okay and so what this does this is all done by computer matching okay and so we've talked about before how with the IRS when you get a tax document in the mail you need to know that the IRS also has a copy right so if you get a 1099 a w-2 or you know whatever in the mail something from your investment all of these forms have already been sent to the IRS so the IRS already has these documents they're just waiting for you to confirm what's already been sent okay so we're this used to require human intervention now there is a program that does this and it's happening a lot faster now so you know so what what I'm telling you is that you know when you get these tax documents please do not ignore them because the IRS already knows they're just waiting on you so what happens is the IRS matches the information from the third party okay so let's just say I get a 1099 from my affiliate marketing company okay you should get a 1099 if you made six hundred dollars or more but you still have to report all of your income that is your responsibility to report all of your income but you should receive a 1099 if you get paid six hundred dollars or more okay so let's say I get a 1099 from my affiliate marketing company with you know for a thousand dollars okay I've made a thousand dollars this year of my affiliate marketing company now if that company is also sending that to the IRS and so once I file my taxes okay once I file my taxes then that's when the computer work starts the automated under reporter program they start running it from the time that the tax is due okay so if your taxes are due on April 15th then that's when they start running these things usually you start getting letters you know the May June timeframe because April 15th is when all this you know is usually when the taxes are due unless you have filed an extension but tax is due April 15th okay so after April 15 that's when they start winning computers and the computer goes ding lissandra has filed her taxes but she didn't report this 1099 and we got this 1099 right here Bing something's wrong okay so then you know so there's that you know there's that discrepancy that raisin basically raises a red flag and so now what happens is that's when you start getting letters now what tax examiners do and this is what I got from a tax examiner okay at the IRS you know what they do is they really want to get it off their desk right they really want to try to get it resolved so that's when you start getting letters that show hey this is what you filed this is what we have this is the adjustment that we've made you owe us you know $300 and you know send us our money or if you disagree with what we have then you need to show us why you disagree so the the main thing here is when you get a letter from the IRS do not ignore it okay that's not going to make things go away do not ignore letters from the IRS and again I reiterate letters the IRS does not call you they do not