Category : Legal Insights

Why You Should File Your Taxes Early

January may just be the first month of the year to think about paying your federal income tax but it pays off later on if you will consider paying your taxes on this month rather than wait until the April deadline. If you are particularly concerned about getting your income tax return early, then you should consider paying your taxes early as well. Aside from this, here are some more reason to file your income tax early.

1. You Will Be More Prepared

You will have more time to know new rules and apply them during filing. You don’t have time to review rules when it comes to your taxes in any other days so by filling early, you will have more time to study it. If you will do your paperwork early, you or your accountant will have more time to determine if any changes will affect the computation and you can make the necessary adjustment to it. If you ignore applying these new rules, it might spell trouble later on so do your homework first before you submit Form 1040, or any other form.

2. You Will Be Less Likely To Be A Victim Of Tax Fraud

The Federal Trade Commission says that tax identity theft is becoming more rampant on the busiest part of the tax season which is during April. Tax lawyer, Lawrence Brown, has often suggested that if you can, you should submit your tax forms early. The more taxpayers are becoming eager to pay their taxes before the deadline the more that they tend to ignore some small security aspects of it. This is when scammers are given the chance to sneak on someone else’s personal information and then pocketing their refund. The National Consumer League believes that the best way to combat these scammers is by filling Form 1040 early because you and the IRS have ample time to monitor and guard your application process.

3. You Might Get Your Refund Faster

The IRS is keen to issue more than nine out of ten refunds in less than 21 days after receiving the returns. In 2015, 73% of taxpayers have issued money back, amounting to a total of $2,857. If you are one of those who is expecting a tax refund, why not try to get it sooner than later. You can use the refund to pay for other dues or to finance a business goal.

4. Financial Aid

A document showing the completion of filling for tax return can help in getting financial aid. College students can use the information in Form 1040 to apply for a student loan. On the other hand, prospective homebuyers can use the form as a proof of their household income.

Types Of IRS Tax Reviews

Dealing with the IRS regarding taxation Law is never pleasant, but you should know the basic things that would take after an IRS review notice so you can call upon the right kind of help, in this case, a tax lawyer. All IRS Notices or Letters contain a notice number in the upper right-hand corner. These numbers will additionally illuminate you about the particular issues with your tax return. When you recognize what you are being examined for, you can contract your lawyer and begin gathering significant reports.

Different Types of IRS Tax Reviews

There are distinctive sorts of tax reviews, each with their own particular prerequisites. Knowing how you are being reviewed will help you figure out what reports you require, where to send them, and whether you require a tax attorney. With one type called the Correspondence Audit, the IRS approaches you for more data concerning a piece of your tax return. The IRS is, for the most part, looking for receipts, checks, and comparable data. In Office Audit, the IRS Service Center requests that you acquire certain records to your neighborhood IRS office. In Field Audit, an IRS operator goes to your place of business to lead the review face to face.

Taxpayer Compliance Measurement Program Audit this is the broadest sort of review, where all aspects of your tax return must be substantiated by archives, including birth and marriage endorsements. The basic role of this review is to overhaul the information used to compose the PC scoring program.For both field reviews and TCMP reviews, it’s exceedingly suggested that you have a legal counselor while the review is led. These types of reviews can go wrong really quickly, which is why the presence of a lawyer is necessary. They would be able to get you out of any hot water you suddenly find yourself in.

The Presence Of A Tax Lawyer

Handling an IRS review is best with the assistance of a tax lawyer. When you get notice of an IRS tax review, contact the tax guide who arranged your arrival. He or she can clarify the review procedure and help you get ready. In the event that you are still anxious about the review, or have a field examiner going to your work environment, it’s a smart thought to enlist an expert tax legal advisor. They can tell you what the process would entail by the Law.

The Importance of the Presence of a Tax Lawyer

When you recognize what is anticipated from you, you can begin to handle your records to locate the pertinent receipts and archives. Never send in your unique archives or your exclusive duplicate, and never send in more than is asked. On the off chance that you can’t discover pertinent documentation, promptly ask for copies, since the inspectors won’t acknowledge the reason that records are absent or lost. When you have each one of your duplicates and firsts, get them sorted out, particularly on the off chance that you are confronting an in-person review. Great association demonstrates to the specialist that you are a dependable taxpayer, and may bring about the operator constraining the extent of their examination. Basically, you can explain the review all alone.

Make photograph duplicates of the greater part of the important records. For example, if the IRS is scrutinizing your tithing add up to your congregation, make a photograph duplicate of the yearly aggregate title printed material that your congregation sent you. In the event that they are asking about something, for example, your home office, take photos of the workplace underscoring that it is solely utilized for work. Get together each one of the photos and reports and send the records back in with a letter clarifying the criticalness of each. On the other hand, the presence of a lawyer can be helpful in case of any surprises.