The Tax Compliance Process

Slides:

Advertisements

Similar presentations

Chapter 12 Tax Administration & Tax Planning

Advertisements

Chapter 2B. Tax Practice C8-Chp-02B-1-Tax-Practice Howard Godfrey, Ph

Chapter 18 The Tax Compliance Process McGraw-Hill Education Copyright © 2015 by McGraw-Hill Education. All rights reserved.

IRS AUDIT OF TAX RETURN PREPARERS: The Good, The Bad and The Ugly 1.

Income Tax Fundamentals 2009 Gerald E. Whittenburg & Martha Altus-Buller Student’s Copy 2009 Cengage Learning.

Tax Practice and Administration: Sanctions, Agreements, and Disclosures Chapter 13.

Module 3 TAX PRACTICE, PROCEDURES, & PROFESSIONAL RESPONSIBILITIES.

Chapter 16 Tax Administration and Practice Tax Administration and Practice Copyright ©2008 South-Western/Thomson Learning Corporations, Partnerships, Estates.

Chapter © 2010 South-Western, Cengage Learning Federal Income Tax Our Tax System Filing Tax Returns 7.

C Comprehensive Volume Chapter 26 Tax Practice And Ethics Copyright ©2010 Cengage Learning Comprehensive Volume.

CHAPTER EIGHT OVERVIEW OF TAX PROCEDURE. THE ADMINISTRATION OF THE FEDERAL TAX LAWS l Compilation of tax statutes enacted by Congress.

1 Chapter 15: Administrative Procedures. 2 ADMINISTRATIVE PROCEDURES (1 of 2) n Role of the IRS n Audits of tax returns n Requests for rulings n Due dates.

 Click to edit Master text styles  Second level  Third level  Fourth level  Fifth level #17-1 McGraw-Hill/Irwin © 2005 The McGraw-Hill Companies,

Income Tax Fundamentals 2010 Gerald E. Whittenburg & Martha Altus-Buller 2010 Cengage Learning.

2 - 1 ©2004 Prentice Hall, Inc. The Tax Practice Environment Chapter 2.

Income Tax Fundamentals 2010 Gerald E. Whittenburg & Martha Altus-Buller Student’s Copy 2010 Cengage Learning.

©2007 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license. Chapter.

Tax Compliance, the IRS, and Tax Authorities

© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

CCH Federal Taxation Basic Principles Chapter 1 Introduction to Federal Taxation and Understanding the Federal Tax Law ©2004, CCH INCORPORATED 4025 W.

Chapter 11 Accounting Periods and Methods. Learning Objectives Explain the rules for adopting and changing an accounting period Explain the differences.

McGraw-Hill/Irwin Copyright © 2012 by The McGraw-Hill Companies, Inc. All rights reserved. Chapter 02 Tax Compliance, the IRS, and Tax Authorities.

2 - 1 ©2005 Prentice Hall, Inc. The Tax Practice Environment Chapter 2.

Chapter 12 Tax Administration & Tax Planning Income Tax Fundamentals 2008 Gerald E. Whittenburg & Martha Altus-Buller Student’s Copy.

Copyright © 2015 by the McGraw-Hill Education. This is proprietary material solely for authorized instructor use. Not authorized for sale or distribution.

1 Automated Underreporter (AUR) and Correspondence Examinations Main Line Association for Continuing Education November 21, 2013 Richard G. Furlong, Jr.

© 2010 South-Western, Cengage Learning SLIDE 1 Chapter 7 Do Now9/26/13 & 9/27/13 Work with your neighbor and create a list of ways people accumulate earned.

Chapter © 2010 South-Western, Cengage Learning Federal Income Tax Our Tax System Filing Tax Returns 7.

Irwin/McGraw-Hill ©The McGraw-Hill Companies, Inc., 2000 Principles of Taxation Chapter 17 The Tax Compliance Process.

15-1 ©2008 Prentice Hall, Inc ©2008 Prentice Hall, Inc. ADMINISTRATIVE PROCEDURES (1 of 2)  Role of the IRS  Audits of tax returns  Requests.

1 Chapter 15: Administrative Procedures. 2 ADMINISTRATIVE PROCEDURES (1 of 2)  Role of the IRS  Audits of tax returns  Requests for rulings  Due dates.

Chapter 18 The Tax Compliance Process. Filing and Payment Requirements  Due dates  Individual: 4/15, extend to 10/15  Corporate: 15th day of 3rd month,

McGraw-Hill Education Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of.

15-1 ©2009 Pearson Education, Inc. Publishing as Prentice Hall.

15-1 ©2010 Pearson Education, Inc. Publishing as Prentice Hall.

Chapter 2 Tax Compliance, the IRS, and Tax Authorities © 2014 by McGraw-Hill Education. This is proprietary material solely for authorized instructor use.

© 2010 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license.

Chapter 18 The Tax Compliance Process McGraw-Hill/Irwin Copyright © 2013 by The McGraw-Hill Companies, Inc. All rights reserved.

Irwin/McGraw-Hill ©The McGraw-Hill Companies, Inc., 2002 Principles of Taxation Chapter 17 The Tax Compliance Process.

Chapter 1 An Introduction to Taxation. Learning Objectives Discuss the history of taxation Differentiate between three types of tax rate structures Describe.

#17-1 McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved. Chapter 17 The Tax Compliance Process.

CHAPTER EIGHT OVERVIEW OF TAX PROCEDURE. EXPECTED LEARNING OUTCOMES Appreciate and understand: l The voluntary nature of federal tax reporting l The basic.

Chapter 6 Deductions and Losses. Learning Objectives Distinguish between deductions for and from AGI Discuss the criteria for deducting business and investment.

2 - 1 The Tax Practice Environment Chapter Tax Practice Tax compliance  Preparing returns  Representing clients at IRS audit Tax planning 

 Legal requirement to file returns and pay taxes. ◦ I.R.C. Sections 6001, 6011 ◦ Regulations under § 6011  Self-assessment system. ◦ Proper form, required.

Interest, Surcharge & Compromise Penalties Estelita C. Aguirre, CPA, MM Lecture No. 16.

Chapter 18 The Tax Compliance Process Filing and Payment Requirements Due dates Individual: 4/15, extend to 10/15 Corporate: 15th day of 3rd month, extend.

Chapter 7 Federal Income Tax. Our Tax System Types of Taxes Progressive taxes Regressive taxes Proportional taxes Components of the Tax System The IRS.

15-1 Copyright © 2013 Pearson Education, Inc. publishing as Prentice Hall.

Chapter 2-Part A. Filing Requirements, Estimated Tax Statute of Limitations Penalties Edited September 7, 2016 Howard Godfrey, Ph.D., CPA Professor of.

Individual Income Tax Computation and Tax Credits

©2007 Prentice Hall, Inc..

Federal Income Tax Debt

Tax Compliance, the IRS and Tax Authorities

Positions Taken On a Tax Return

Prepare Tax Documentation for Individuals

Tax Compliance, the IRS, and Tax Authorities

FAS 109: Accounting for Income Taxes

The Tax Practice Environment

Amended Returns Prior Year Returns

Amended Returns Prior Year Returns

MYPF 7.1 Our Tax System 7.2 Filing Tax Returns

Chapter 7 Review Personal Finance.

©2008 Prentice Hall, Inc..

©2009 Pearson Education, Inc. Publishing as Prentice Hall

MYPF 7.1 Our Tax System 7.2 Filing Tax Returns

VAT Module 10 (b) VAT Administration and Compliance

MYPF 3.1 Our Tax System 3.2 Filing a Tax Return

Chapter 15: Administrative Procedures

Presentation transcript:

The Tax Compliance Process Chapter 18 The Tax Compliance Process

Filing and Payment Requirements Due dates Individual: 4/15, extend to 10/15 Corporate: 15th day of 3rd month, extend to 15th day of 9th month Payments are due by ORIGINAL due date. Late payments TO IRS incur interest. Refunds paid by IRS within 45 days of filing do not carry interest.

Late-Filing and Late-Payment Penalties Penalty is a function of taxes OWED. If taxpayer is due a refund, there is no late filing penalty. Combined penalty = 5% of balance due per month late for 5 months, then 1/2 of 1 percent for up to an additional 45 months.

Statute of Limitations The IRS has three years from the later of statutory due date (4/15) or date actually filed If the taxpayer omits > 25% of gross income, IRS has six (6) years. Fraudulent returns are open indefinitely.

The Audit Process Corporate returns selected mainly by size. Individual returns are scored by IRS using discriminant function system. Returns audited more frequently: high income, high deduction personal business (Schedule C)

Types of Audits Correspondence - routine audits conducted by mail - send in documentation, explanations, etc. Office exams take place at an IRS district office - limited scope. Field exams take place at the taxpayer’s place of business - these are broader in scope. Deficiency is the additional tax owed. If interest is charged, it is deductible if the taxpayer is a corporation, but only for individuals if the liability is related to the operation of the individual’s business.

Noncompliance Penalties - Negligence Applies when the IRS determines that the “taxpayer did not make a good faith effort to compute the correct tax.” Penalty = 20% of any underpayment attributable to the taxpayer’s failure to make this reasonable attempt. Negligence versus mistake? complexity of issues, taxpayer’s education/experience, cooperation with IRS, advice from professionals

Noncompliance Penalties - Civil Fraud 75% of tax underpayment due to fraud. Fraud is the “intent to cheat the government by deliberately understating tax liability.” Systematic omission of substantial amounts of income Deduction of nonexistent expenses 2 sets of books

Noncompliance Penalties - Criminal Fraud Tax evasion = criminal fraud Up to $100,000 individual, $500,000 corporation Prison IRS must show guilt beyond a reasonable doubt

Tax Return Preparer Penalties Failure to sign - $50 per failure Taking a position with no realistic possibility of sustaining on its merit - $1,000 per return up to 50% of preparer compensation. Intentional disregard of rules a regulations - $5,000 per return up to 75% of the compensation for the return.

Contesting Audit Results - Appeal See IRS Problem Resolution department - if this fails, Appeal is 1st step See Publication 5, Appeal Rights and Preparation of Protest for Unagreed Case

IRS Collections IRS can seize property When corporations are dissolved, shareholders have transferee liability for back taxes up to the value of any assets received on liquidation. Spouses may not be subject for deficiencies attributable to the other spouse under the innocent spouse rule. Doesn’t apply if spouse received benefit from evaded/avoided taxes.