The Department of Internal Revenue (IRS) is about to implement an aggressive strategy against high income taxpayers. According to recent reports, the IRS has hired a large number of new agents throughout the country and in turn, become more aggressive to enforce the tax law that indicates we must have the files in order and available in case of an audit.
According to the small business section of the IRS, Accounting Today magazine states that audits decreased during the last two years, estimating a loss in tax collection of $1.9 billion, which forces the IRS to implement and increase the hiring of new agents all over the country.
These new agents will be focused on audits against small businesses with a minimum of $ 200,000 or more in their total revenue. According to IRS statements, the audits would be directed to this specific sector because it is an area that, due to lack of administrative controls, tend not to comply with the law and are at risk of being audited.
Who is included in the small business classification? Clearly, the transportation sector and mainly independent drivers.
If you are an independent owner operator and have a total income of $ 200,000 or more during the fiscal year, you could be a candidate to be audited. According to the aggressive strategy that is to be implemented by the IRS, the owner operator may be under the spotlight and be a primary target, as stated by a high-ranking official in the Internal Revenue Department: “Taxpayers who underreport their tax liability undermine the integrity of our tax system. Compliant taxpayers deserve to know that noncompliant taxpayers are at risk of audit or other enforcement actions, and as a result may be assessed civil penalties, and where appropriate, criminal enforcement will be pursued. High-income taxpayers are no exception and are an enforcement priority."
Our suggestion to all our friends of transportation and mainly to independent drivers that, being a target and candidates for an IRS audit, it is of the utmost importance that they keep all their files in order and available for a successful defense before the Internal Department of Revenue, thus avoiding an unpleasant surprise.