12 IRS Audit Flags For 2012

English: United States Internal Revenue Servic...

12 IRS Audit Flags For 2012: “IRS audit” is one of most-feared phrases in the English language. While the chance of being audited is pretty low (about one in 100), the chance of being touched by the IRS is on the rise, according to my colleague Kathy Kristof. You may be one of the unlucky two percent of taxpayers who are subjected to random audits, but most IRS inquiries arise for specific reasons. Here are the 12 audit flags for 2012. Remember, many of these are legitimate — just make sure that you have all supporting documentation in case the IRS calls.

1. Not reporting income: Whoops — forgot about that consulting gig? The IRS receives copies of all 1099s and W-2s you receive, so make sure you report all income on your return. If you receive an incorrect 1099, talk to the issuer and make sure that a corrected form is filed with the IRS.

2. A large change in income: The IRS computers have all of your historic data, so when there’s a big change from the previous year, it can trigger a red flag.

3. Being self-employed: Self-employed workers take note: The IRS doesn’t trust you, because so many of you are trying to game the system by under-reporting income and overstating deductions. This class of taxpayer must be well-prepared to defend all deductions and credits. Continue Reading…

Websites Go Dark To Protest SOPA PIPA Bills

Websites Go Dark To Protest SOPA PIPA Bills: In the first strike of its kind, thousands of popular sites such as Wikipedia, Reddit and Boing Boing shut down for up to 24 hours Wednesday to protest a pair of federal antipiracy bills that they said amounted to censorship of the Internet.

The online grass-roots campaign is directed at the Stop Online Piracy Act and the Protect Intellectual Property Act, which aim to crack down on foreign websites that traffic in pirated movies, music and counterfeit goods.

To protest the bills before they go to a vote, pages on Wikipedia’s English language encyclopedia site have gone dark and now feature a short note that tells visitors to “Imagine a World Without Free Knowledge.”┬áThe note went on to say: “Right now, the U.S. Congress is considering legislation that could fatally damage the free and open Internet. For 24 hours, to raise awareness, we are blacking out Wikipedia.”

Visitors are given a link where they can learn more and then are urged to contact local legislators by plugging in a ZIP code. Continue Reading…