Tags: Taxes | Uncle Sam | IRS | Economy

WSJ on Taxes: Making Sure You Get What's Yours and Uncle Sam Gets What's His

By    |   Monday, 30 March 2015 09:00 AM


As April 15 approaches we're all looking for ways to both save on our taxes and make sure we don't do anything that will raise the IRS' eyebrows.

The Wall Street Journal's Laura Saunders offers several tips.
  • "Understand the new health-care provisions," she writes. "Under the Affordable Care Act, filers this year must check a box on Line 61 on the 1040 form if they had approved health-care coverage for all of 2014, or possibly pay a penalty if they didn’t."
  • Make sure all the data you enter for your wages and investment income are correct. "The only category in which the number of audits increased last year was in so-called correspondence exams of taxpayers earning more than $200,000," Saunders explains. A correspondence may stem from the IRS discovering a discrepancy between your return and data filed by your employer or investment brokerage.
When it comes to audits, Jeff Reeves, editor of InvestorPlace.com, cites several issues that could arouse suspicion of your return by the IRS.
  • "Typos and bad math," he writes in USA Today. "If the form you get from your employer says one number, and you input a different figure into TurboTax, you could open the door for an IRS audit."
  • "A big one-time change." For example, if you claim a huge deduction that you never have before, that could become a trigger for an audit.
  • Too many deductions. "If a taxpayer has an unusually high amount of itemized deductions given their income levels, an audit is potentially more likely," Paul Dunham, tax managing director at business services firm CBIZ, told Reeves. Make sure you have documentation to back up your deductions.
If you do get audited, Jason Notte of Main Street offers several tips to emerge from the ordeal unscathed.
  • "Don't go in alone," he advises. "Unless you're especially deft at preparing your taxes and dealing with IRS or state auditors, you're likely going to want someone to either coach you or—in the case of an in-person audit—be in the room to help out."
  • "Get organized." Make sure you have proof of your income and deductions.
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As April 15 approaches we're all looking for ways to both save on our taxes and make sure we don't do anything that will raise the IRS' eyebrows. The Wall Street Journal's Laura Saunders offers several tips.
Taxes, Uncle Sam, IRS, Economy
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2015-00-30
Monday, 30 March 2015 09:00 AM
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