Identify theft is more prevalent than ever, and most of us have either been victims ourselves or know somebody that has. Some of the time, the damages are relatively minor – some time and effort spent canceling credit card accounts, and so forth. In other cases, the results can be devastating.
Over the last several years, the IRS has made a concerted effort to crack down on American citizens who have attempted to “hide” assets overseas in an effort to avoid taxation. Their strategy was simple – by gradually phasing in tax penalties (and criminal prosecution in certain circumstances), they hoped to encourage taxpayers to come clean of their own free will in order to avoid more harsh penalties down the road.
As a small business owner, it can seem downright impossible to stay on top of your tax reporting requirements. Running a business is demanding enough – and jumping through a never ending string of IRS hoops is exhausting.
Any taxpayer that has faced an IRS audit or tax dispute knows exactly how “nitpicky” the IRS can be. Heaven forbid you failed to account for a dollar claimed as a tax deduction, or forgot to record two dollars of income. In fact, the IRS won’t hesitate to assess penalties and interest for even the smallest oversight.
The IRS is unlikely to win a popularity contest any time soon. Taxpayers of all income levels, occupations, and political ideals generally are able to unite around their shared dislike for the IRS.
Recent data indicates that more Americans than ever are filing their taxes without professional help this year. In many cases, these taxpayers are completing their tax returns by themselves, or using software programs to assist with the process. Often times, this is a smart move – if you could save yourself some money and you have the time to spend on the project, it seems to make sense to file on your own.
Today’s tax code is more complicated than ever. There are seemingly endless pages of regulation covering a wide variety of seemingly obscure subjects, from how to handle a gift from a relative to how to calculate the deduction for your home office and just about everything else you could think of. Not only is the tax code complicated, but the stakes are high. A mistake on your tax return could easily lead to IRS penalties, interest, and sometimes even criminal prosecution.
For a taxpayer, being selected by the IRS for an audit represents an absolute nightmare. At the very least, an IRS audit represents stress and a great deal of time. And in many cases an IRS audit leads to tax penalties and worse for the taxpayer.
For decades, Americans have depended on offshore banking institutions to protect their assets and ensure privacy. However, in an attempt to crack down on tax fraud, the IRS has taken steps in recent years to eliminate the privacy shields that once existed. In particular, the IRS and the US Department of Justice have targeted Swiss banks, once known as among the most discreet and private in the world.
The IRS loves a good fight – as millions of taxpayers have unfortunately learned the hard way. Of course, most of the time they aren’t fighting professional fighters. In this case, however, that’s exactly what they are doing. The IRS has recently filed a multi-million dollar tax lien against renowned boxer Manny Pacquiao.