Jim Payne's Tax Blog in Gainesville, FL

For S corporation owners, reasonable compensation is crucial for staying compliant with the IRS. As both shareholders and employees, owners must pay themselves a fair salary based on their work. This is important because shareholder-employees receive funds through wages (subject to payroll taxes)...

While the thought of an IRS audit can be stressful, the reality is that only about 0.4% of individual tax returns are audited each year. However, certain red flags can increase your chances. Understanding these triggers can help you avoid mistakes and reduce your audit risk. Here are the most com...

If you run a small business and report income and expenses on a Schedule C, the last thing you want is for the IRS to categorize your endeavor as a hobby. Why? Because hobby losses aren't deductible, while business expenses are. The IRS scrutinizes businesses that consistently report losses, and ...

When IRS auditors examine a business, they often use indirect methods to estimate income. This is especially common when records are incomplete or inconsistent. One method compares a business's cash and credit card deposits to industry averages. However, a growing problem is that the IRS sometime...

Knowing how to use the IRS Collection Appeals Process (CAP) can help protect your rights if you face IRS collection actions like levies or liens. CAP lets taxpayers challenge IRS enforcement actions. It may also delay or prevent those actions while your case is reviewed. Here’s a guide on how to...

Dealing with the IRS can be frustrating, especially when problems aren’t resolved through normal channels. The Taxpayer Advocate Service (TAS) is here to help when things go wrong. But when should you turn to TAS? Here are key situations where they can make a difference:1. Financial Hardship or I...

When dealing with IRS collection actions, knowing your options for appealing or disputing those actions is crucial. One such option is a Collection Due Process (CDP) hearing. But what happens if you miss the 30-day deadline to request a CDP hearing? Fortunately, the IRS offers another option know...

If you’ve received a notice from the IRS about a lien or levy, you might feel overwhelmed and unsure of what to do next. Luckily, the IRS offers a key safeguard called a Collection Due Process (CDP) hearing. This hearing lets you appeal actions like liens, levies, or a denied installment agreemen...

When navigating a dispute with the IRS, one of the best moves you can make is taking your case to the Office of Appeals. It’s a chance to resolve disagreements without the expense and stress of court. However, one critical factor that can greatly influence the success of your appeal is your level...

Dealing with a tax dispute can be stressful, but the IRS Office of Appeals offers a path to resolve issues without needing a court battle. If you’ve received an IRS decision you disagree with—whether it’s about an audit, penalties, or collection actions—you might find that Appeals is a smoother, ...