The following is direct from the IRS to Tax Professionals around the country.
They are asking tax preparers to turn in their clients for a reward. It is from
Headliner Volume 193 dated March 1, 2007.
'During the filing season buzz of preparing returns and talking with clients or
potential clients, you may encounter individuals or companies that are not
complying with the tax laws. The IRS is committed to increasing compliance and
encourages you to report noncompliant taxpayers by completing IRS Form 3949-A or
writing a letter and mailing the information to: Internal Revenue Service,
Fresno, California 93888.
Although not all inclusive, activities in violation of the tax laws include:
• Deliberately underreporting or omitting income.
• Overstating deductions.
• Keeping multiple sets of books.
• Making false entries in books and records.
• Claiming personal expenses as business expenses.
• Claiming false deductions.
• Hiding or transferring assets or income.
If you choose to send a letter instead of Form 3949-A, include the following
information, if available:
• Name and address of the person you are reporting.
• The taxpayer identification number (social security number for an individual
or employer identification number for a business).
• A brief description of the alleged violation, including how you became aware
of or obtained the information.
• The years involved.
• The estimated dollar amount of any unreported income.
• Your name, address, and daytime telephone number.
You are not required to identify yourself when reporting suspected tax fraud
activity; but, it is helpful to do so. Keep in mind that your identity can be
kept confidential, and you may be entitled to a reward.'
Look at the activates listed above. Do you do any of them? Do you ever put cash
in your pocket instead of the register? Ever report an expense, as business when
you really knew it was personal? Ever claim personal miles in your business log?
Ever restructure your business to report less income for child support purposes?
Ever take less reportable income and take perks on the side to qualify for
income levels for a government program. Ever not report cash income from a hobby
business?
Now, have you ever told anyone? Your wife? An employee? Your lawyer? How about
your accountant? Does your tax preparer know, or even suspect?
If you are not following the law you need to be aware that the IRS is offering
to pay people to turn you in and you will never know who did it. Ex-wives are
the biggest source of tips on tax cheats followed by ex-employees. If you are
cheating, anyone, anywhere that finds out can turn you in for cash. It may take
the IRS several years to get around to you but they never forget.
However by the same token the competitor of yours who pays contact labor instead
of payroll, or who deliberately over reports his expenses, or brags about the
cash he receives and does not report. Here is your chance to level the playing
field.
Charles J. Read, CPA has been in the payroll, accounting and tax business for
30 years, the last fifteen in private practice.
Mr. Read is the author of “How to Start a New Business.”
To find professional payroll service at a budget price go to
http://www.PayrollonaBudget.com a paperless payroll company.
For a full service payroll bureau with CPA’s on staff visit
http://www.CustomPayroll.com .
See an excerpt of Mr. Read’s interviews from William Shatners “Heartbeat of
America” television show on the web sites linked above.
