Tuesday, January 28, 2020

Who's Afraid of the IRS?

Too many people...

The IRS is not in the business of scaring honest people.
They are in the business of verifying compliance with the tax laws of the United States.

They don't throw people in jail for making a mistake on their tax return.

If you don't lie to the IRS, ignore the IRS, or take frivolous positions, you have very little to worry about beyond having to pay some money back with penalties and interest.

Take an aggressive, reasonable stance on your tax return for which you have the documentation to defend, commensurate with your financial risk tolerance. By risk tolerance I mean that if you take an aggressive position that could require you to pay back thousands of dollars plus penalties if you lose at audit, and that would financially devastate your financial life, maybe be a little less aggressive.

Don't lie.
Don't Cheat.
Be aggressive.
Don't be frivolous.
Have your ducks in a row.
NEVER ignore a letter from the IRS.

Do that, and you have very little to be afraid of.

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