The end of “Tax Season” is just around the corner – April 17 this year. But it is best to be aware of how all your activities affect our tax situation throughout the year.
As your income and business interests go up, this becomes ever more important. Most times, when taxpayers bring in or assemble their tax documents and information to do a tax return, all the taxable events have already occurred in the past year, and can only be dealt with in the most advantageous way, after the fact. Everyone should be more proactive, all the time, in considering the tax consequences of all their activities and financial affairs by seeking the input from a tax professional ahead of time. Paying them to help you to try and get out ahead of these taxable events is money well spent.
When you do get into trouble with the IRS, or any other taxing authority, it is good to know that the IRS actually has a “Tax Payer Bill Of Rights.” A brief description of these follow here.
- The Right to be Informed.
Taxpayers have the right to know what they need to do to comply with the tax laws. They are entitled to clear explanations of the laws and IRS procedures in all tax forms, instructions, publications, notices and correspondence.
- The Right to Quality Service.
Taxpayers have the right to receive prompt, courteous and professional assistance in their dealings with the IRS, to be spoken to in a way they can easily understand, to receive clear and easily understandable communications from the IRS.
- The Right to Pay No More Than the Correct Amount of Tax.
Taxpayers have the right to pay only the amount of tax legally due, including interest and penalties, and to have the IRS apply all tax payments properly.
- The Right to Challenge the IRS’s Position and Be Heard.
Taxpayers have the right to raise objections and provide additional documentation in response to formal IRS actions or proposed actions, to expect that the IRS will consider their TIMELY objections and documentation promptly and fairly.
- The Right to Appeal an IRS Decision in an Independent Forum.
Taxpayers are entitled to a fair and impartial administrative appeal of most IRS decisions, including many penalties, and have the right to receive a written response regarding the Office of Appeals’ decision. Taxpayers generally have the right to take their cases to court.
- The Right to Finality. Taxpayers have the right to know the maximum amount of time they have to challenge the IRS’s position as well as the maximum amount of time the IRS has to audit a particular tax year or collect a tax debt. Taxpayers have the right to know when the IRS has finished an audit.
- The Right to Privacy. Taxpayers have the right to expect that any IRS inquiry, examination or enforcement action will comply with the law and be no more intrusive than necessary, and will respect all due process rights, including search and seizure protections. 8. The Right to Confidentiality.
Taxpayers have the right to expect that any information they provide to the IRS will not be disclosed unless authorized by the taxpayer or by law.
- The Right to Retain Representation.
Taxpayers have the right to retain an authorized representative of their choice to represent them in their dealings with the IRS.
- The Right to a Fair and Just Tax System.
Taxpayers have the right to expect the tax system to consider facts and circumstances that might affect their underlying liabilities, ability to pay or ability to provide information timely.
These are right from the IRS.gov/Taxpayer Bill of Rights website, and a full description can be found there. It is always good to try to deal with your tax issue, and never just ignore it. It will only get worse. Sometimes you can handle it with a phone call yourself. All these tax matters can have a huge impact on your financial situation now, and in the future. QCBN
By Ernie Gallardo
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