Tax Audit ‘Red Flags’ From The IRS As We Approach Tax Day In Cheyenne
Every year, or so it seems, the I.R.S. is out to unveil monies that have been stashed overseas or in some other haven that they deem to be a 'red flag' area. Today on the Top 5 at 7:45, I'll highlight what some are telling us may be 'red flag' areas to avoid be it your 'home office' or 'charities'. Here are some areas that you may want to be mindful of in order to avoid penalties in an audit.
This list of top 5 is only to make you aware. It is in no wise official tax advise. All tax inquiries should be directed to a professional and qualified tax agent.
- Your Charities - Avoid over inflating items prices that you are giving to charities. What you may deem to be a $500 item, the I.R.S. may not see it that way. Make sure that you keep receipts for donations over $250 and be sure to fill out Form 8283 for any non-cash donations over $500.
- The Home Office - According to some sources, the home office is one of the most abused and most complicated deductions in the tax code. The I.R.S. is looking to simplify it this year. Now, you're able to claim $5 per square foot up to 300 square feet of your home for office space. It will be capped at $1500 per year.
- Claiming The Same Child As Someone Else - Should your ex-spouse file on a child before you do, the I.R.S. will be looking at you with a raised eye brow. Most likely, the courts will be the one's to decide who will have primary custody over the child for various purposes.
- Money Overseas - It seems that more and more often the I.R.S. has been on the rampage to retrieve monies that have been stashed illegally overseas. Before you open an overseas account, it might be a good idea to check it out with someone in "the know."
- Deducting Gas Costs - In this day and age, more employers are reimbursing employees for gas expense when they use their personally owned vehicles for business. So if you are claiming thousands of dollars on the car, they may want to audit your employer to see if any reimbursements were provided.
The Top 5 at 7:45 airs weekdays with me, Gary Freeman and sponsored by First Education Federal Credit Union.