Getting Money Back from the IRS
AdultInternetLaw.com
"There are two systems of taxation in our country: one for the informed and one for the uninformed."
Judge Hand, US Appeals Court Justice
The IRS recently refunded 18 Billion Dollars to small businesses in a 30-month period.
The internal revenue code allows for individuals and businesses to file amended tax returns for a period of three years. In 2001, more than 3.3 million people filed amended tax returns for refunds on excessive tax payments. Why? A large majority of taxpayers fail to claim all deductions and credits available to them in the tax code resulting in the overpayment of taxes by as much as 40%.
It goes without saying that tax regulations are exceedingly complex. The tax code currently consists of more than 2,800,000 words, hardly a light read. When it comes to filing taxes, most treat taxes in the following manner: 1) dump their tax information on an accountant at the last moment; 2) use one of the popular tax software programs; or 3) prepare their own returns [scary]. The problem with each of these approaches is that the particulars of your business are not taken into account. This results in numerous deductions and exemptions being missed and the loss of hard-earned income to the IRS and state tax agencies.
Accountants
Many businesses use accountants to handle their tax filing responsibilities. Money Magazine, however, found that accountants rarely keep current on the changes in tax laws or claim all available deductions. In one study, the magazine submitted identical tax records to 46 tax preparers and received 46 different answers on the amount of taxes due! Still feel confident about your accountant's work?
Amended Tax Return Service
We provide an amended tax return service in which the last three years of your federal and state tax returns are reviewed at no cost by bonded, certified public accountants with over twenty years of experience. If it is determined that you are due a refund, amended tax returns are filed on your behalf. As of this article, every adult-oriented client that has taken advantage of this service has received a refund. There is no guarantee that you will, but there is no risk in giving it a try since there is no fee unless a refund is obtained.
Following are answers to frequently asked questions.
Do you back-up your amendments?
Yes. If you are audited on any of the amendments we make, we will handle the audit for you at no cost. However, we are not responsible for any audit attributable to the figures you supplied on your original tax return. Since we didn't prepare the original return, we are not taking responsibility for it!
Who can participate?
If you have a business, you can use the service. Whether you are a corporation, sole proprietorship [Schedule "C"], partnership, LLC or some other entity, you should pursue the tax amendment review.
What percentages of businesses overpay and what is the average refund?
Roughly 70-80% of all of our clients, including mainstream, are eligible for refunds. The average refund depends upon your overall revenues, but $10,000 is an average figure.
What is the largest refund obtained?
In November of 2002, one client received a refund of $47,000.
Are returns amended for both Federal and State tax filings?
Yes. Your state taxes are based on your federal return. If you qualify for a return on your federal filings, you will almost always get money back from the state.
Will I get audited?
In twenty years of filing amended tax returns, the CPAs we use have had one return audited. In that situation, the audit resulted in the refund being reduced from $32,0000 to $22,000.
How long does it take?
The process takes approximately 8 weeks from beginning to end. Obviously, we are dealing with "highly efficient" government entities, so there can be delays.
What does it cost?
The review of your tax returns is free. If a refund is obtained, the fee is 50% of the refund.
Why the hell is the fee 50%?
The fee reflects the compensation to the tax professionals and incidentals involved in the business. Before reading this, you had no expectation of getting money back from the tax agencies. If the fee causes you concern, consider the following: You now have $0. You could put $5,000 back in your pocket on an average refund of $10,000. Think it is worth it?
Shouldn't I just ask my accountant to review my returns?
No. If the accountant made mistakes on the original filing, there is little reason to believe that they will notice the mistakes. Even if they find mistakes, do you think they will admit them to you?
Don't scam artist promote this service to steal identities?
Unfortunately, a few unscrupulous people have used this service for identity theft. Our service, however, is legitimate. Obviously, you know who I am and where I can be found. We also insist that both parties sign a simple contract that contains a confidentiality clause in the contract for your benefit. We do not collect, rent, resell, distribute or do anything else with your information. If you ever have a problem or question, you can contact me at:
info@adultinternetlaw.com
Process
The process essential involves singing a contract with us, an IRS power of attorney form to file the amended returns, sending in your tax returns for three years and going through a phone conversation with one of our CPAs. At that point, we will know if you are due a refund and will get the amended tax returns filed with the appropriate agencies. You will note that we ask you sign a power of attorney. The power of attorney is a form issued by the IRS that allows the accountant to sign the amended tax returns for you. If the IRS takes issue with the filing, the accountant's name is on it, not yours.
In Closing
You work long and hard on your adult business. How much time do you spend on updates, design tweaks, attracting traffic and building reoccurring memberships or client relationships? Why throw away unnecessary money on taxes?
To find out more, contact me by phone (858-427-2170) or email.
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AdultInternetLaw.com |
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Webmaster Resource of the Month
With the tax season upon us, we have devoted this
newsletter to tax-related issues. In addition to the
article on amending your tax returns to obtain
refunds, we are also including an interview with an
accountant in San Diego, California.
John Fitzgerald is fairly well known to most of our
clients. John provides accounting services to
mainstream and adult-oriented clients. He is very
proactive with our clients, often reducing their tax
load significantly. This link will take you to the
interview with John.
Click here for interview.
Requests, Questions, Comments?
Have questions you would like answered in this newsletter? Any particular people or sections of the industry you would like to see us interview? Submit them to us.
info@adultinternetlaw.com
Link to Us!
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