Month: June 2019

How to Avoid IRS Underpayment Penalties

Written by Paul Belfiore on June 28, 2019. Posted in Blog, Taxes.

Litchfield Resident Seeks Help

If you wind up owing $1,000 or more in taxes, you may incur an IRS underpayment penalty. For the last tax season, those who paid in at least 80% of their tax bill did not incur the penalty, in the future that number will be 85%. If you wind up a significant amount in taxes, it is important to adjust your tax withholdings for the current year. This may mean having your employer take more out of your paycheck or increasing estimated payments for those that are self-employed.

What Are Some Red Flags for an IRS Audit?

Written by Paul Belfiore on June 17, 2019. Posted in Blog, Taxes.

Goffstown Resident Inquires

Certain activity, even when legitimate can increase your risk for an IRS tax audit. Some deductions can make an audit more likely including home office, business meals and travel, unreimbursed business expenses and alimony. Errors in math on your return and not reporting taxable income, in the form of 1099s and W2s, are also all red flags.

A resident in Goffstown, NH was concerned about running the risk of an IRS audit. He contacted Merrimack Tax Associates looking for suggestions to reduce that risk.