In 2005, my taxable income was about $55,000. I deducted $3400 extra which I shouldn't have and which will raise red flags (gambling losses, home office expenses, mountain biking costs).
If I get audited, what would be the penalty? Is it worth filing an amendment?
2007-03-27 04:22:26 · 5 answers · asked by bellas 1 in Business & Finance ➔ Taxes ➔ United States
If you have realized an error, then, yes...It is best to file an amended return. Once you complete your amendment (1040X) you will see what the tax liability is, and penalty for late payment. It is better than getting audited and caught any-time!
http://www.irs.gov/taxtopics/tc308.html
good luck & bless
2007-03-27 04:56:36 · answer #1 · answered by Wood Smoke ~ Free2Bme! 6 · 3⤊ 0⤋
It took the big computer 3 years to catch a 'boo boo' in my return.
They recalculate the return for true taxes due , but late penalties and % charges date back to the incident so it is the years of back charges that add up.
Mountain biking costs ? Do your have a tour business ?
If you think there is a serious probability of it being caught , better to file the amendment sooner as there will be fewer years of % charges on the amounts.
2007-03-27 11:28:55 · answer #2 · answered by kate 7 · 2⤊ 0⤋
I experienced a similar situation a number of years ago, so I know it can get quite intense at times. The truth is that with an income of $55,000, you're chances of getting whacked(audited) by the I.R.S. are fairly, but there's still a chance. I'd just go ahead and ride it out. Just make sure to save a couple of buck just in case it comes back to haunt you.
-J.
2007-03-27 11:40:29 · answer #3 · answered by Jason 4 · 0⤊ 1⤋
file an amendment and make the additional payment as soon as you can. (mountain biking!!?? what were you thinking about??)
2007-03-27 11:44:41 · answer #4 · answered by Ovrtaxed 4 · 3⤊ 0⤋
Federal pound me in the As prision. Sorry.
2007-03-27 11:30:17 · answer #5 · answered by Anonymous · 0⤊ 1⤋