Doing one's taxes is not always an easy process. Even if New York residents use online resources or tax professionals to file their documents, they may still end up with questions from the IRS. In some cases, tax controversies can result, and individuals may need to handle discrepancies.
Dealing with taxes is annoying at best and immensely complicated at worst. For some New York residents, their yearly tax journey may not end with simply filing their returns and receiving a refund or having a bit more taxes to pay. In some cases, the Internal Revenue Service could suspect an issue, and some taxpayers may have to handle tax controversies.
Tax season is typically not one that individuals look forward to. Though possibly receiving a refund can make having to go through the often tedious filing process worth it, it can still be a stressful time, especially if the IRS decides to conduct an audit. Tax controversies can cause anyone to panic, but there are ways New York residents could help themselves lessen the likelihood of an audit.
A previous post on this blog talked about how an iconic store in New York City was facing allegations that it evaded collecting and remitting the state's sales taxes for years. The store is now staring down an over $7 million delinquent tax bill that is now pending in the state's courts.
One of the most generous tax deductions available to businesses, as well as not-for-profits, is the ability to deduct an employee's pay. For the most part, this is not controversial. After all, all but the smallest companies need to have employees to help with the running of the business's affairs. So, the IRS and other authorities will generally allow compensation to be deducted as a necessary business expense, so long as the employees in question are legitimately on the company's payroll. However, these matters can become more complicated as businesses grow and their top leaders demand higher pay.
Many people in White Plains and other parts of New York may wish to set up a not-for-profit corporation and then apply for an exemption from income taxes and, by extension, other state taxes as well. This is most often referred to as 501(c)(3) status.
Although this blog has touched on the subject before, it may be helpful to review the possible consequences of family loans.
Many people in White Plains and the other communities around New York City have hobbies. In most cases, people probably think of a hobby as something that a person spends money on in order to get a non-financial benefit, like relaxation or personal satisfaction.
Many New Yorkers may already know that there are a lot of generous tax benefits associated with home ownership. In addition to being able to deduct interest from mortgages, for instance, the sale of a home can also be exempt from capital gains tax, at least up to a certain amount.
Particularly for some smaller to mid-sized businesses in the greater New York area, it may be easier to pay certain bills under the table, that is, in cash or otherwise outside the business's normal accounting system.