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Audit Proof your Tax Return No one likes the stress involved when your tax return is under the audit spotlight. Here are some ideas to avoid some of the more common audit triggers.  Learn our tips and tricks to audit proof your tax return from Tax Advisors of Cary. Report everything that has an informational tax return. If you are like most Americans, you will receive numerous 1099’s, W-2’s, and

If you don’t receive a W-2 or 1099, is this a defense to protect yourself from not reporting the income during an audit? In short, the answer is no. You are required to report your income whether your employer or customer filed the correct form or not. So what can you do to ensure you do not find an audit surprise in your future due to a simple omission of

Some of these items may surprise you. There are a number of areas in the tax code that cause confusion as to the taxability of money received. Here are some of the most common areas of confusion. Alimony. Alimony is taxable to the person who receives it and deductible to the person who pays it. Special rules apply. Make sure you have proper documentation as part of a divorce decree

Picture this; for the past few years you have picked up your tax return and have had a small but nice refund. Now imagine your surprise, when next year, you are required to send in a fairly big check to settle your tax bill. Believe it or not, this message is almost as hard to deliver to a taxpayer as it is to hear it. Here are some tips to

Lost in the recent news regarding stolen identities at Snapchat and the credit and debit card theft at major retailers, is the dramatic increase in identity theft and scams using the IRS. One of the more recent scams announced by the IRS is worth noting. The scam Callers identifying themselves as the IRS phone you and disclose that you owe delinquent taxes. They say that unless there is immediate payment

Surprise! Your stock loss is not deductible. As you look for year-end tax moves to save on your bill from Uncle Sam, you may consider selling stocks that have lost value. This can be a great strategy when up to $3,000 in stock losses can offset your ordinary income. However, there is a little known rule called the Wash Sale rule that could surprise the unwary taxpayer. Wash Sales If

The Kiddie Tax – What to Know The term “kiddie tax” was introduced by the Tax Reform Act of 1986. The IRS introduced this rule to keep parents from shifting their investment income to their children and have this income taxed at their child’s lower tax rate. The law requires a child’s unearned income (generally dividends, interest, and capital gains) above a certain amount ($2,000 in 2013) to be taxed

Health Flex Spending Arrangement Rules Changing Do you have funds in an employer provided Health Flexible Spending Arrangement (FSA)? If you worry about the long-standing rule of using up those funds or you’ll lose them, then a new notice from the IRS could be helpful for you this year. Background Millions of Americans take advantage of their employer’s cafeteria plan that allows setting aside pre-tax dollars to be used to

Tips to ensure their deductibility One often overlooked way to reduce your tax obligation is to donate gently used items to a favorite charity. Too often this is done without the necessary forethought to ensure you can deduct the value of these donations on your tax return. Here are some tips to ensure you can receive this tax benefit. Good or Better Condition. Remember only items donated that are in