2024 income tax Archives

Tax season is upon us, and it's time to prepare and file your tax return. But before you rush to submit your documents, it's crucial to take a step back and ensure your return is bulletproof against costly mistakes and potential IRS audits. Avoiding common filing errors by hiring a tax professional who can save you time, money, and stress in the long run.

Here are some steps every taxpayer can take to safeguard their tax return:

Organize Your Documents: Start by gathering all necessary documents, including W-2s, 1099s, receipts, and any other relevant paperwork. Organize them systematically to ensure nothing gets overlooked.
Double-Check Personal Information: One of the most common errors is incorrect personal information. Ensure your name, Social Security number, and other identifying details are accurate and match the information on file with the IRS.
Stay Updated on Tax Law Changes: Tax laws are constantly evolving, and staying informed about the latest changes can help you maximize deductions and credits while avoiding penalties. Consider consulting a tax professional if you're unsure about recent updates.
Report All Income: It's essential to report all sources of income, including wages, freelance earnings, investment income, and any other sources. Failing to report income can trigger IRS audits and hefty penalties.
Claim Legitimate Deductions and Credits: Take advantage of all deductions and credits you're eligible for, but be cautious not to overstate expenses or claim credits you don't qualify for. Keep thorough records to substantiate your claims in case of an audit.
Double-Check Math: Simple math errors can lead to significant discrepancies in your tax return. Double-check all calculations, especially if you're filing manually, to ensure accuracy.
Review for Common Errors: Look out for common errors such as incorrect filing status, missing signatures, and omitted schedules or attachments. Even a small oversight can delay processing or trigger an audit.
E-file and Use Direct Deposit: Filing electronically and opting for direct deposit can expedite your refund and reduce the risk of errors associated with paper filing. E-filing also provides confirmation of receipt by the IRS.
Keep Copies of Your Tax Return: Maintain copies of your tax return, along with supporting documents, for at least three years. These records serve as valuable evidence in case of inquiries or audits from the IRS.
Seek Professional Assistance if Needed: If your tax situation is complex or if you're uncertain about certain aspects of your return, consider seeking assistance from a qualified tax professional. They can provide guidance, ensure compliance, and help you navigate any potential audit process.

By following these steps and exercising diligence in preparing your tax return, you can significantly reduce the likelihood of costly mistakes and IRS audits. Remember, investing time and effort in ensuring accuracy now can save you from headaches down the road. Stay proactive, stay informed, and bulletproof your tax return for a smoother filing experience.

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By entrusting your tax preparation needs to us, you gain access to years of experience, comprehensive knowledge of tax laws, and a commitment to excellence in every aspect of our service. We'll work closely with you to understand your unique situation, identify opportunities for savings, and navigate any complexities with confidence.

Don't leave your financial well-being to chance. Partner with Mark Sullivan Consulting and gain peace of mind knowing that your tax return is in the hands of trusted professionals. Contact us today to schedule a consultation and take the first step toward a stress-free tax season. Let's make this year's filing process smooth, efficient, and rewarding together.

To navigate the increasing scrutiny and complex tax landscape, retaining Mark Sullivan Consulting is essential. Our expertise in IRS audits and tax controversy will ensure your interests are protected. With personalized strategies and a deep understanding of federal tax laws, we provide unparalleled support and peace of mind. Trust us to be your steadfast ally in all tax matters.

Learn more at info@marksullivanconsulting.com or schedule a FREE 30-minute consultation with Mark Sullivan HERE

Mark has an unlimited Enrolled Agents license and is admitted to practice before the Internal Revenue Service based on his extensive experience as a Revenue Officer in New York, NY, St. Louis, MO and Washington, D.C..

Disclaimer: This article is for information purposes only and cannot be cited as precedent or relied upon in a tax dispute before the IRS.

Refunds sent by mail are a popular target for check fraud

Widespread Mail Theft of Refund Checks

Taxpayer refund checks are being stolen from the mail, and in some cases, replacement checks are also being stolen.

Ashlea Ebeling with the Wall Street Journal interviewed Rep. Nicole Malliotakis (R., N.Y.) last October, she reported 218 cases totaling $3.8 million in stolen checks, with amounts ranging from hundreds of dollars to $500,000.
One taxpayer had to request four refund checks, with the third one still missing after being stolen and fraudulently deposited.

Many Taxpayers Still Rely on Paper Checks

While over 90% of taxpayers use direct deposit for refunds, millions still prefer paper checks.

Nearly 10 million paper refund checks were issued by the IRS last year.
Some taxpayers opt for paper checks to avoid sharing banking information with the IRS.
There are also instances where a paper check is issued even when direct deposit was elected, such as when banking information fails validation.

Check Fraud is on the Rise

Refunds sent by mail have become a popular target for check fraud, as reported by the Treasury Department last year.

Once a taxpayer elects to receive a paper check, they cannot switch to direct deposit for that tax year, even in cases of theft or loss.
A technology fix allowing taxpayers to change their preference to direct deposit mid-year is in development but is still a few years away.

IRS Urging Direct Deposit for Refunds

IRS Commissioner Danny Werfel has repeatedly emphasized in public comments that direct deposit is the fastest and safest way to receive refunds.

The IRS and Treasury Department are under pressure from Congress to address the growing problem of stolen checks.
Lawmakers, including Rep. Malliotakis, are calling for stronger measures to prevent mail theft.

How to Get a Replacement Check

The IRS has a process in place to replace lost or stolen checks.

Married couples filing jointly must fill out a taxpayer statement form and mail or fax it to the IRS to initiate a refund trace.
Individuals can call the IRS directly to request a trace.
The Treasury Department’s Bureau of Fiscal Service verifies the claim and issues a new check, typically within 30 days, although the process can take up to three or four months.

Combating Mail Theft and Fraud

The Treasury’s Financial Crimes Enforcement Network has issued alerts about a nationwide rise in mail theft-related check fraud.

Criminals are being prosecuted, with recent cases resulting in prison sentences for individuals involved in large-scale refund check theft.
In one case, two New York men were sentenced for stealing a $2.9 million IRS refund check.

Upcoming IRS Technology Upgrades

The IRS is modernizing its core systems, with a significant upgrade planned to roll out next year.

Future updates will allow taxpayers to use an online dashboard to manage refund preferences and upload forms, eliminating the need for faxing.
As IRS Commissioner Werfel notes, the modernization process requires careful planning to ensure effectiveness.

Bottom Line: Choose Direct Deposit

With refund checks increasingly becoming a target for fraud, the safest way to receive a refund is through direct deposit. While the IRS is working on improvements, taxpayers should act now to protect their refunds from theft.

About the author

Mark Sullivan Consulting assists taxpayers who have fallen victim to refund fraud, providing expert guidance through the IRS refund replacement process. Our team will navigate the complexities of filing refund traces, working with the Treasury Department, and ensuring your case is handled promptly. With years of experience in federal tax controversy, we are dedicated to securing the refunds our clients rightfully deserve while protecting them from further fraud risks. Let us advocate on your behalf and restore your peace of mind.

Learn more at info@marksullivanconsulting.com or schedule a FREE 30-minute consultation with Mark Sullivan HERE

Disclaimer: This article is for information purposes only and cannot be cited as precedent or relied upon in a tax dispute before the IRS.

Additional references: "Millions of Dollars in Tax Refund Checks Are Getting Stolen", Ashlea Ebeling, The Wall Street Journal (October 4, 2024)

2024 Per Diem Plus, LLC. Per Diem Plus proprietary software is the trademark of Per Diem Plus, LLC.®

2025 trucker per diem rates were released by the IRS in an annual bulletin, Notice 2024-68, on September 20, 2024.

For taxpayers in the transportation industry the per diem rate remains unchanged form 2022 to $80 from $69 for any locality of travel in the continental United States (CONUS) and $86 from $74 for any locality of travel outside the continental United States (OCONUS), i.e Canada.

Effective Date: This notice is effective for per diem allowances for meal and incidental expenses, that are paid to any employee on or after October 1, 2024, for travel away from home on or after October 1, 2024.

Note: A motor carrier fleet or owner operator can continue to use the 2024 per diem rate of $69 / $74 until December 31, 2024.

See Notice 2024-68

marksullivanconsulting.com

Have questions about trucker per diem? Request a free consultation HERE with Mark W. Sullivan, EA

About the author

Mark W. Sullivan, EA founded Sullivan Consulting in 1998 in St. Louis, MO and relocated to Scottsdale, AZ in 2020. He specializes in federal tax controversy representation, appeals and consulting on behalf of individuals, businesses, law, and accounting firms nationwide. In addition, he has served as the consulting and expert witness in numerous civil and criminal cases in multiple federal district courts.

Disclaimer: This article is for information purposes only and cannot be cited as precedent or relied upon in a tax dispute before the IRS.

The IRS is ramping up its audit rates for large corporations, complex partnerships, and multimillionaires, thanks to a substantial funding boost from the Biden administration. By 2026, audit rates for corporations with over $250 million in assets will nearly triple, while complex partnerships and high-income individuals will also see significant increases. Despite these changes, the IRS reassures that individuals and small businesses earning under $400,000 won't face increased audit rates. This new focus underscores the importance of robust tax compliance and expert guidance.

Massive Funding Boost

The IRS received a significant increase in funding from the Biden administration.
Funding came through the Inflation Reduction Act (IRA) signed into law in 2022.
$80 billion directed to the IRS.
Goal: Nearly triple the audit rate to 22.6% by 2026.

Increased Audit Rates for Corporations

Applies to corporations with over $250 million in assets.
Current audit rate: 8.8% in 2019.

Focus on Complex Partnerships

Target: Increase audit rates nearly 10-fold to 1% by 2026.
Applies to partnerships with assets exceeding $10 million.
Current audit rate: 0.1% in 2019.

Targeting Wealthy Individuals

Aim: 50% increase in audit rates for individuals with annual income over $10 million.
Expected audit rate: 16.5% by 2026.
Current audit rate: 11% in 2019.

Assurance for Lower-Income Entities

No increase in audit rates for individuals and small businesses earning under $400,000.
Aligns with President Biden’s pledge not to raise taxes on this population.

Audit Process

Involves meeting with an auditor to review the federal tax return.
Auditor may request additional documentation to support claims.

Discrepancies can lead to:

Tax evasion charges.
Civil fraud penalty of 75% of the understated tax.
In severe cases, jail time.

This detailed audit plan reflects the IRS's enhanced capacity to scrutinize high-value entities, backed by significant federal support.

Learn more at info@marksullivanconsulting.com or schedule a FREE 30-minute consultation with Mark Sullivan HERE

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Additional References: "The IRS says audits are about to surge — here’s who’s most at risk" Shannon Thayler, New York Post (May 3, 2024)

Hey there, tax-savvy pals! Ever wondered if your trusty four-legged friend could actually help you fetch some a tax deduction on your tax return? Well, let's dive into the world of guard dogs and their potential impact on your taxes.

Picture this: your business has that intimidating "Beware Of Dog" sign on the window. Break-ins? Zilch since your Rottweiler moved in. So, can you actually claim a tax deduction for your guard dog's expenses? The IRS might just say yes!

But, as always, standard business deduction rules apply. Your dog's presence and the expenses associated with it must be ordinary and necessary for your line of business. If you can prove that, then the costs of keeping your loyal guardian well-fed, healthy, and trained can be deducted as a legitimate business expense.

Oh, and breed matters, too! Your tax claim gains more credibility if your guard dog is a formidable breed like a German shepherd, Doberman pinscher, or something similarly imposing. Sorry, Chihuahua, but your bark may not cut it for the IRS.

In a nutshell, while you can't exactly claim your dog as a tax deduction (no matter how loyal and fierce they are), you can potentially deduct the expenses associated with their "guard dog" role if you meet all the necessary criteria.

So, there you have it, folks. Guard dogs - not just your business's best friend, but potentially your wallet's best friend too! 🐕💰

Remember, it's always wise to consult with a tax professional to ensure you're on the right track. Stay pawsitive, and keep those business premises safe! 🐾

Do you need assistance with tax analysis and consulting? Request a free consultation HERE with Mark W. Sullivan, EA

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Navigating Tax Time: Tips To Avoid Common Pitfalls & Maximize Savings

Introduction: In its ongoing mission to enhance tax compliance and equity, the Internal Revenue Service (IRS) recently unveiled a significant initiative on February 29th. This effort is squarely aimed at high-income taxpayers who have neglected to file their federal income tax returns. With over 125,000 instances of non-filing identified since 2017, the IRS is taking proactive steps to address this issue.
The Initiative: This new undertaking, funded by the Inflation Reduction Act, commences with the dispatch of IRS compliance letters this week. These letters are being sent to more than 25,000 individuals with incomes exceeding $1 million and over 100,000 individuals with incomes ranging from $400,000 to $1 million for the tax years spanning 2017 to 2021. It is anticipated that 20,000 to 40,000 CP-59 Notices will be issued weekly, initially targeting taxpayers in the highest income brackets.
Understanding the CP 59 Notice: The CP-59 notice, recently updated, is dispatched when the IRS lacks records of prior personal tax returns being filed. It outlines the steps taxpayers can take to rectify their non-filing status:
- File their signed, personal tax return promptly or provide reasons for not filing.
- Complete Form 15103, Form 1040 Return Delinquency, included with the notice to clarify reasons for filing late or why filing isn't necessary.
- Detach the notice stub and mail it with the tax return and completed Form 15103 using the provided envelope. Alternatively, taxpayers can fax their information to the number provided, ensuring they understand the privacy and security policies of the fax service used.
Enhancements in the Updated CP 59 Notice: As part of the broader transformation within the IRS funded by the Inflation Reduction Act, the CP-59 notice has been revised to align with the recently announced Simple Notice Initiative. These enhancements aim to provide simplified, clear, and easily understandable information, along with more electronic options to assist taxpayers in fulfilling their tax obligations. Key improvements include:
- Enhanced content emphasizing instructions on filing, obtaining transcripts, and payment options.
- Integration of QR codes directing taxpayers to filing information and resolution options for balances.
- Reduction in the number of pages to streamline communication.
Escalation of IRS Actions: Recipients of these letters are urged to take immediate action to avoid further follow-up notices, heightened penalties, and stronger enforcement measures. Additionally, failing to file past due tax returns promptly can lead to various consequences, including:
- Accrual of interest and penalties.
- Risk of losing refunds.
- Impact on Social Security benefits.
- Potential for IRS enforcement actions, including collection, audit, and criminal prosecution.
Tax Return and Collection Actions: For taxpayers who repeatedly fail to respond and file, the IRS may generate a substitute tax return based on reported income from employers, financial institutions, and other sources. However, this substitute return may not account for deductions and exemptions to which the taxpayer is entitled. Consequently, it's in the taxpayer's best interest to file their own return to maximize benefits.
Conclusion: The IRS's latest initiative targeting high-income non-filers underscores the agency's commitment to enhancing tax compliance and fairness. Taxpayers receiving CP-59 notices should act promptly to address their non-filing status and avoid potential consequences. By understanding the implications and taking proactive steps, taxpayers can ensure compliance with their tax obligations and mitigate any associated penalties or enforcement actions.

Why choose Mark Sullivan Consulting, PLLC? As high-income taxpayers navigate the complexities of addressing unfiled tax returns and potential IRS settlements, it's essential to seek expert guidance and support. Mark Sullivan Consulting stands ready to assist in this critical process. With years of specialized experience in federal tax controversy, audit, and appeals representation, as well as tax consulting and advisory services, Mark offers unparalleled expertise and dedication to client success.

By retaining Mark Sullivan Consulting, high-income taxpayers can benefit from personalized guidance tailored to their unique financial situations and tax challenges. From preparing unfiled tax returns to negotiating settlements with the IRS, Mark Sullivan Consulting provides comprehensive support every step of the way. With a commitment to integrity, transparency, and excellence in service, Mark Sullivan Consulting empowers clients to navigate IRS compliance initiatives with confidence and peace of mind.

Learn more at info@marksullivanconsulting.com or schedule a FREE 30-minute consultation with Mark Sullivan HERE

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Navigating Tax Time: Tips To Avoid Common Pitfalls & Maximize Savings

Per Diem Plus Small Fleets requires users to complete the account setup HERE before using the app.

Tax season can be a stressful time for many Americans, but with a little knowledge and preparation, you can navigate it with confidence. Here are some practical tips to help you avoid common pitfalls and maximize your tax savings.

Avoid Simple Mistakes: The IRS reports that simple miscalculations are among the most common issues on tax returns. Double-check your math and ensure you've entered all information correctly, especially regarding filing status, Social Security numbers, and bank account details.
Don't Miss Investment Income: Remember to report all investment income, including dividends and capital gains. Failing to do so can result in penalties and fees from the IRS. Keep track of any 1099 forms you receive from investment firms and ensure they're accurately reflected in your tax return.
Understand Capital Gains: Be mindful of your investment holding periods, as they determine your tax rates. Short-term gains are taxed as ordinary income, while long-term gains may qualify for lower tax rates. High earners may also be subject to additional Medicare surtax on investment income.
Maintain Good Recordkeeping: Keep detailed records of your investment transactions, including purchase prices and sale proceeds. This information is crucial for accurately calculating gains and losses, which can impact your tax liability.
Utilize Tax-Loss Harvesting: Consider offsetting realized gains with losses through tax-loss harvesting. This strategy can help reduce your tax bill by maximizing deductions on investment losses.
Beware of Wash Sales: Avoid engaging in wash sales, which occur when you sell an investment at a loss and repurchase a substantially identical asset within 30 days. This can invalidate your loss for tax purposes and complicate your tax reporting.
Take Advantage of Tax Breaks: Don't overlook available tax credits and deductions, such as the Child Tax Credit or charitable contributions. These can significantly reduce your tax liability or taxable income, providing valuable savings.
Mind Deadlines: Be aware of tax deadlines for various deductions and contributions. Missing deadlines could result in missed opportunities for savings or penalties for late filings.

In conclusion, while tax season may seem daunting, taking proactive steps to understand your tax obligations and opportunities can lead to significant savings. Whether you're filing your taxes independently or with the help of a professional, attention to detail and awareness of potential pitfalls are key. By staying informed and organized, you can navigate tax time with confidence and optimize your financial outcomes. Remember, every dollar saved in taxes is a dollar that can contribute to your future financial security.

Learn more at info@marksullivanconsulting.com or schedule a FREE 30-minute consultation with Mark Sullivan HERE

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IRS Orders Immediate Stop To New Employee Retention Credit Claims (IRS Newswire, 9/14/23)

Per Diem Plus Small Fleets requires users to complete the account setup HERE before using the app.

Disclaimer: This article is for information purposes only and cannot be cited as precedent or relied upon in a tax dispute before the IRS.

Struggling to find a tax accountant these days? The accounting industry lost 300,000 professionals since COVID began. Mark Sullivan Consulting, PLLC is adding income tax preparation services in response to taxpayer demand.

Tailored Expertise: Trust the seasoned experience of Mark Sullivan, an Enrolled Agent since 1998, in providing top-notch tax services. Benefit from specialized knowledge in IRS federal tax controversy, audit and appeals representation.
Comprehensive Support: Whether you're an employee or a self-employed individual, our services cater to your unique tax needs. Mark Sullivan Consulting ensures meticulous attention to detail, guiding you through the intricacies of tax preparation with a focus on the gig economy and transportation industry.
Strategic Advisory: Beyond numbers, we offer strategic tax consulting and advisory services. Navigate the ever-evolving trends in federal tax with confidence, backed by ethical and transparent practices that uphold our commitment to unparalleled expertise and customer service.
Efficient and Transparent Processes: Experience seamless and transparent tax preparation processes designed to save you time and alleviate stress. We believe in making tax season a breeze, ensuring your focus remains on what matters most – your work, business, and personal pursuits.
Your Ally Against Tax Challenges: Mark Sullivan is not just a tax consultant; he's your ally in defending taxpayers against challenges. With a positive perspective and a commitment to protecting the weak, our goal is to bring out the good in every person and provide you with a reliable defense against potential tax hurdles.

Embark on this journey with Mark Sullivan Consulting as we launch our new income tax preparation services. Let us take the complexity out of taxes, allowing you to thrive personally and in your business endeavors. Cheers to a seamless tax season ahead!

Learn more at info@marksullivanconsulting.com or schedule a FREE 30-minute consultation with Mark Sullivan HERE

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IRS Orders Immediate Stop To New Employee Retention Credit Claims (IRS Newswire, 9/14/23)

Per Diem Plus Small Fleets requires users to complete the account setup HERE before using the app.

2024 trucker per diem rates and tax brackets were released by the IRS in Revenue Procedure 2023-34. For detailed information, please refer to the Tax Foundation.

Trucker Per Diem Rate

For taxpayers in the transportation industry who are subject to DOT HOS the per diem rate remains unchanged from 2023 at $69 for any locality of travel in the continental United States (CONUS) and $74 for any locality of travel outside the continental United States (OCONUS), i.e. Canada.

Mark Sullivan Consulting Launches New Income Tax Services For Truckers

IRS Orders Immediate Stop To New Employee Retention Credit Claims (IRS Newswire, 9/14/23)

2024 Tax Brackets Announced

2024 Standard Deduction

Child Tax Credit

Sec. 199A - Qualified Business Income Deduction

2024 Earned Income Tax Credit

Have you noticed Per Diem Plus is suddenly not tracking your trips? The likely cause is location services settings have been changed on your device after software update by Apple or Google. This is an easy issue to fix.

iPhone

Open Settings>Privacy>Verify Location Services are ON
Select Location Services>Per Diem Plus / Per Diem Plus Fleets
Set to "Always Allow"

Android

Open Settings>Privacy>Permission Manager
Select Location>Per Diem Plus / Per Diem Plus Fleets
Set to "Allow all the time

Drivers, try Per Diem Plus or Small Fleets absolutely free for 30 days!

Download Per Diem Plus for iOS

Download Per Diem Plus for Android

Get Per Diem Plus Small Fleets for iOS

Get Per Diem Plus Small Fleets for Android

Per Diem Plus Small Fleets requires users to complete the account setup HERE before using the app.

About Per Diem Plus

Per Diem Plus is a proprietary mobile software application that was designed by truckers and built by tax pros. It is the only IRS-compliant mobile app for iOS and Android that automatically tracks each qualifying day of travel in the USA & Canada and replaces ELD backups (logbooks) to substantiate away-from-home travel.

About the Author

Mark is tax counsel for Per Diem Plus. With nearly two decades of experience advising trucking companies on per diem issues, Mark was responsible for defining the Per Diem Plus software logic rules that automatically calculates trucker per diem in accordance with IRS regulations. He also previously served as the consulting per diem tax expert for Omnitracs.

In addition to his time working with Per Diem Plus, Mark works in private practice as an Enrolled Agent at Mark Sullivan Consulting, PLLC specializing in federal tax controversy representation and consulting. He also served as the consulting and expert witness for the Federal Defenders Office and private defense counsel in financial crimes cases in multiple federal district courts. Contact Mark W. Sullivan, EA

Disclaimer: This article is for information purposes only and cannot be cited as precedent or relied upon in a tax dispute before the IRS.

Source: "2024 Tax Brackets", Alex Durante, Tax Foundation (November 8, 2023)

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Here are some steps every taxpayer can take to safeguard their tax return:

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Widespread Mail Theft of Refund Checks

Many Taxpayers Still Rely on Paper Checks

Check Fraud is on the Rise

IRS Urging Direct Deposit for Refunds

How to Get a Replacement Check

Combating Mail Theft and Fraud

Upcoming IRS Technology Upgrades

Bottom Line: Choose Direct Deposit

About the author

About the author

About the author

About the author

About the author

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Trucker Per Diem Rate

2024 Tax Brackets Announced

2024 Standard Deduction

Child Tax Credit

Sec. 199A - Qualified Business Income Deduction

2024 Earned Income Tax Credit

Drivers, try Per Diem Plus or Small Fleets absolutely free for 30 days!

About Per Diem Plus

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