Most people don’t get excited about tax season. In fact, most of us hate this time of year, but it’s nothing to dread if you stay knowledgeable. The first step is knowing about common IRS tax problems so you can find the right solution for your situation.
Read More : The Key Differences Between A Passport Card & A Passport Book
Inability to Pay Tax Debt
One of the biggest issues during tax season is getting slapped with a massive debt you weren’t expecting. Maybe it’s because you filed incorrectly or your employer didn’t take out enough. Regardless, you are not responsible for the debt. It can be scary, but there’s no need to worry.
The IRS is usually more than happy to work with someone that has a large debt and wishes to pay. All you need to do is contact the IRS directly and ask for a payment plan. With your income in mind, they will formulate a plan that allows you to pay down your debt comfortably without having to worry about paying everything up front.
Penalties and Interest
It may be tempting to miss tax season, especially if you know you owe money. You can get to it later, right? Wrong. From the minute you miss the deadline, you start accruing penalties and interest that can turn manageable debt into a large sum that is difficult to pay, especially if you have back taxes for several years in a row.
Read More : Weekly Horoscope: May 13–19, 2024
Naturally, the best way to avoid this is to make sure you pay your taxes and file on time every year. However, that may not be possible for everyone. If you owe quite a bit of money over a span of a few years, contacting a tax professional may be your best bet. They may be able to decrease your debt and find a manageable way to pay it.
Not Enough Paperwork
You need various types of paperwork to get your taxes filed, especially if you own a business or have assets tied up in the stock market or real estate. Sometimes, it can feel tough just getting your W-2s. Thankfully, you don’t need to worry. By law, your company is required to give you your W-2s by January 31st. If you haven’t received them by February 14th, it is in your best interest to contact the IRS; they will help you find your W-2s and file on time.
For everything else, it’s best to keep all of your paperwork in one folder labeled for tax season. That way you don’t have to stress! You can grab the folder, visit your tax professional, and have your taxes finished before the deadline. At minimum, you need proof of any income you receive, deductions, and health insurance information for the year.
IRS Audit
One of the biggest fears that anyone has during tax season is that they’ll experience an audit. The first thing to remember is that you’re not being singled out when you are chosen for an audit. The IRS’s primary goal is to check that there are no mistakes on your tax return and make sure you’re paying the right amount.
Read More : Federal Judge Suspends Joe Biden’s Plan to Slash Credit Card Late Fees to $8
It may be scary to be chosen, but if you are, your tax professional should stand by your side through the process. The results may not be that terrible. Additionally, you may never even see an IRS professional. Some audits are even completed by mail. To avoid an audit, just make sure that your information is 100% correct before sending it to the Internal Revenue Service.
