It’s up to you whether to just pay the bill or challenge it if you think the IRS didn’t calculate it correctly.
2. Run a small business? Prove it. Very few people make a profit when they first start their own business. The IRS understands this… up to a point.
Report losses for three or more years and the agency will start to suspect your business is more of a hobby than a venture aimed at turning a profit, said former IRS tax attorney Garrett Gregory of Addison, Texas.
Such “hobby loss” cases may trigger a field audit, which is in-person and more onerous than a correspondence audit.
–
8. Be smart about mortgage interest: When you own a home with your spouse, your lender will send you and the IRS a Form 1098, which records how much mortgage interest you paid during the year.
But sometimes the form only includes the name and Social Security number of one spouse, DeFilipis said. Should that person die, and the surviving partner tries to claim the mortgage interest deduction, that may trigger a correspondence audit.
So have the lender change the name and Social Security number on the 1098 before filing. Or, if there’s not time for that before April 15, file for an extension and submit your return when you have an amended 1098 in hand.
Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2015 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2015. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor’s and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2015 and/or its affiliates.
