Law Talk Radio: Audit and Tax Issues with Tax Attorney Robert McKenzie

Despite your best efforts at diligently filing proper tax returns, the IRS can audit your tax returns and Robert McKenzie is a tax attorney who can help sort out the mess. Sometimes the audit results areworse than expected and other times with proper representation the process can be least intrusive. Inthis episode of Law Talk Radio we examine tax law from several perspectives

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2012 National Taxpayer Advocate Delivers Annual Report to Congress

On January 11, 2012 National Taxpayer Advocate Nina E. Olson released her annual report to Congress, identifying the combination of the IRS’s expanding workload and declining resources as the most serious problem facing taxpayers. The result, the report says, is inadequate taxpayer service, erosion of taxpayer rights, and reduced tax compliance. The Advocate expressed her continuing concern that the IRS’s expanding use of automated processes to adjust tax liabilities is causing harm to taxpayers and recommended that Congress enact a comprehensive Taxpayer Bill of Rights.

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IRS Correspondence Audits

The Compliance Center computers are programmed to select those returns with high DIF scores which reflect issues that could be easily resolved by mail. The computers select those returns which are appropriate for correspondence audits and each respective return is reviewed by either a Tax examiner or clerk. The returns are DIF screened and quality reviewed using technically proficient examination personnel who are experienced in DIF screening operations. Returns which have apparent examination issues other than those appropriate for correspondence audit are referred to the local Area Office. Some examples of the kinds of items which can be verified by correspondence are itemized deductions, such as interest, taxes, contributions, medical expenses, and simple miscellaneous deductions such as union dues and small tools. Issues other than itemized deductions may be examined if they are single matters which would not be appropriate for office audit or field examination.

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Cancellation of Debt

If a debt is canceled or forgiven, other than as a gift or bequest, the debtor generally must include the canceled amount in gross income for tax purposes. A debt includes any indebtedness for which the debtor is liable or which attaches to property the debtor holds.

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Gambling and Taxes

Gambling and Taxes = The Price of Winning By: Robert E. McKenzie ©2011   Custom Search   Inclusion of Gambling Income in Gross Income  Income from gambling,[1] lotteries,[2] sweepstake winnings,[3] and card playing[4] are included in gross income. Such income…

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Money Laundering and Foreign Bank Accounts

Under the Bank Secrecy Act, U.S. residents or a person in and doing business in the United States must file a report with the U.S. Treasury if he or she has a financial account in a foreign country with a value exceeding $10,000 at any time during the calendar year. Taxpayers comply with this law by noting the account on their tax return and by filing Form 90-22.1, the Foreign Bank and Financial Account Report (FBAR). Willfully failing to file an FBAR report can be punished under both civil and criminal law.

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