You don't want to mess with the Tax Office. One small mix-up when handling your finances can cost you big.
In recent years the Tax Office has increased its filing of levies, liens and wage garnishments. The experts offer this list of common ways people get into trouble with the Tax Office.
- Filing too many exemptions. An exemption gives you a major tax deduction, and some taxpayers can't resist the temptation to report more exemptions than they're entitled. You can only claim exemptions for yourself, a spouse and for all "dependents." Dependents have to meet specific criteria, however, so make sure you follow the Tax Office guidelines so that you don't mistakenly file an extra exemption.
- Being unaware of taxes levied for early withdrawal pension plan, you may face a tax penalty for your investments, and charged with the income tax on the money withdrawn.
- Not paying enough taxes when self-employed. Many people who own their own businesses don't know how much they have to pay in taxes. The tax structure for a self-employed person - what to pay, how to pay and what can be deducted - is decidedly complex, so it's easy to become confused.
- Not paying taxes on winnings. It is necessary to report all gambling winnings, including winnings from lotteries, casinos and horse races, as income.
For people who are in trouble with the Tax Office, there are various programs available that can provide debt relief if a taxpayer qualifies.
Tax Consultants around the world can help you to determine if you meet the requirements of the Tax Regulations.
It will involves some major specialists such as former tax officer, certified public accountants, attorneys, agents and other experts that offer tax services, financial planning, small business services and other assistance.