July 2020 Archives

Do these things on your taxes, and you may be audited

The Internal Revenue Service's audit department is busy, but it is not because most taxpayers' returns contain questionable information. Less than 1% of the population is audited every year, which is a far lower number than it used to be. IRS staffing and funding are simply lacking, leaving fewer agents to review and investigate suspicious tax returns. Knowing this may make some Connecticut residents feel they can take little care when preparing their tax filings, but they shouldn't.

Connecticut residents carry a significant tax burden

When it comes to taxes, not all states are created equal. Some have higher tax rates than others, which can greatly affect residents' economic positions. Connecticut residents in particular carry a significant tax burden, as tax rates here are some of the worst in the country.

Not filing tax returns will catch up with you at some point

Like other Connecticut residents who haven't file tax returns for several years, you may have had one bad year where you failed to file, but thereafter, it became a downward spiral. Granted, if you are due a refund, you are not obligated to file a return. However, you only have three years to do so in order to get the money the IRS owes you.

Being audited? Don't panic

Being the subject of a tax audit can be an unnerving experience. Panic is the overall feeling people have when they find out they are being audited. However, Connecticut residents can help themselves by remaining calm and seeking assistance to handle the matter as swiftly as possible.

Filing for an extension could increase your tax debt

There are plenty of reasons why some Connecticut residents will be unable to have their taxes completed and filed by this year's deadline, which is fast approaching. The Internal Revenue Service allows those who require extra time to prepare and file their tax returns the ability to request extensions, which would give them until mid-October to have everything squared away. While an extension can be a helpful tool, for those who owe money, it can actually end up increasing their tax debt.

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Baker Law Firm, P. C.
24 Delay Street, Suite 1
Danbury, CT 06810

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