Tag: business
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Why Every S-Corporation Owner Needs a Reasonable Compensation Basis
S-corporation owners are required to pay themselves a reasonable salary for the work they perform. The IRS scrutinizes these salaries, and failure to properly document reasonable compensation can trigger audits and penalties. Many business owners struggle to determine what is considered reasonable. Steve Perry, EA at Books Taxes & More creates comprehensive, audit-proof reasonable compensation…
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Understanding IRS Letter 3164: How Steve Perry, EA Can Help
IRS Letter 3164 often catches taxpayers off guard. This notice means the IRS is preparing to assign your overdue tax account to a private collection agency. While this letter does not demand immediate payment, it signals that the IRS considers your account inactive and unresolved. The purpose of Letter 3164 is to inform taxpayers before…
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Understanding IRS CP40:What it means and How an Enrolled Agent Can Help
– The IRS CP40 Notice indicates a taxpayer’s unpaid tax debt has been assigned to a private debt collection agency authorized by the IRS to handle lower-priority cases before the collection statute expires. – Private agencies cannot use IRS tools like liens, levies, or garnishments, and the notice means the IRS prioritizes other cases. -…
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What Is IRS Notice CP59 and How an Enrolled Agent Can Help
When a taxpayer receives IRS Notice CP59, it means the IRS believes they did not file a required tax return. This notice is sent when the IRS has no record of a return being filed for a specific year, even though they have information that suggests one was required. While the notice itself does not…
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How an Enrolled Agent Can Help Resolve IRS Notice CP2566
IRS Notice CP2566 indicates a missing tax return, prompting a proposed tax assessment based on available income data. It signals ignored prior requests and necessitates urgent action. Taxpayers can resolve it by filing the return, disputing the assessment, or seeking help from an Enrolled Agent like Steve Perry to ensure compliance and reduce liabilities.
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Understanding IRS Notice CP2000: What It Means and How an Enrolled Agent Can Help
The IRS Notice CP2000, generated by the Automated Under Reporter program, indicates discrepancies between reported income and third-party data. It includes proposed tax adjustments and requires a response. Taxpayers can agree, disagree, or partially agree with changes using an Enrolled Agent for assistance. Prompt, accurate responses are crucial.
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Understanding IRS Notice CP14: What It Means and How an Enrolled Agent Can Help
No one likes to receive mail from the IRS, especially when it says money is owed. One of the most common notices issued by the IRS is Notice CP14, which informs taxpayers that they have a balance due on their federal income taxes. While the notice can feel alarming, it is not the end of…
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Understanding IRS Letter 566: Your Audit Notice Explained
IRS Letter 566 notifies taxpayers that their tax return is under audit, requiring specific documentation for review. While it doesn’t indicate wrongdoing, timely responses are crucial. Engaging an Enrolled Agent ensures proper guidance and protection of taxpayer rights throughout the audit process, helping resolve issues efficiently.
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Responding to IRS Letter 11: Why Prompt Action and Professional Help Matter
IRS Letter 11 is a significant notice signaling a taxpayer’s account is under serious collection threat, allowing a limited chance to challenge levies. Taxpayers have 30 days to request a Collection Due Process hearing using Form 12153, with an option for an equivalent hearing later. Engaging an Enrolled Agent can aid timely responses and negotiations…
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Understanding IRS Notice CP49: What It Means and How an Enrolled Agent Can Help
Receiving a tax refund is usually a welcome event, but sometimes the IRS applies that refund to a prior balance owed rather than issuing a check or direct deposit. When this happens, the taxpayer may receive IRS Notice CP49, which can come as a surprise if the prior balance was unknown or forgotten. Understanding the…
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