Tax season is a part of the year that most Americans dread. This is a time of number crunching, money gathering, and downright stress. This is why most people will go out of their way to either hire a yearly accountant that does their taxes or they will get the help that is provided by tax services.
Understanding accounting and taxes at a base level is confusing, to say the least. That is on the surface level of just gathering tax data and compiling it into a tax form. This does not even begin to scratch the surface on deductions, tax credits, and other qualifiers. Here are all of the facts on how tax services can help you.
Tax credits can help reduce your annual tax amount each year. For instance, on the of the potential tax credits that can be used in the research and development tax credit. This can end up amounting to nearly 13.5 centers of credit for each qualified dollar. All of this tax service lingo can be a bit confusing and that is why people will utilize tax services to help them out in this situation.
The IRS can audit any business tax return within three years of filing, and it can collect back taxes owed for up to 10 years. This just goes to show that the IRS, internal revenue service, has a lot of power. So you need to make sure you do your taxes right and take care of your business.
The IRS carries out three different types of tax audits. This includes correspondence audits by mail, office audits, and field audits in which the IRS comes to your place of business. If you need help with tax preparation or dealing with these audits then definitely make sure you are getting the help provided by tax services.
In 2015, corporate income taxes comprised 11% of the taxes collected by the federal government. Individuals who filed a Schedule C, which is Profit or Loss from Business, with gross receipts of $25,000 to $100,000 were audited at a 1.9% rate in 2014, while those with gross receipts of $100,000 or more faced a 2.3% audit rate.
Civil fraud penalty refers to a penalty for underpayment of tax that results from a fraudulent activity. If you fail to pay the taxes or underpay the taxes you owe, you will be charged 5% to 25% of the unpaid tax each month. Corporations that have assets of $10 million or more are required to electronically file their income tax returns.
Small C corporations, which are limited to total assets less than $10 million, faced an overall audit rate of 1% in 2014. Companies with assets between $1 million and $5 million were audited at a 1.2% rate, and those with assets between $5 million and $10 million faced a 1.9% rate. C corporations with assets between $10 million and $50 million were audited at a 6.2% rate.
Every single year tax season will creep on people in the United States. Do not be one of these people. If you need help then take some time to look at the high number of availalbe tax services that can hepl you handle your tax preparation process.