It is every taxpayer’s responsibility to file their taxes annually. These are important documents that the IRS uses to gauge your income level.
Failing to file proper returns is tax fraud under the law. It is a criminal offense that has consequences.
When filing returns, you might need to attach supporting documents. These could be W-2 documents, schedules, etc. You could even be required to attach amended returns.
When filing returns online, it is easy to attach these additional documents. The problem arises when you mail physical copies of these documents. So, when mailing physical copies,
Do I Staple My Tax Returns?
You should not staple any document to your tax returns. Leave the original tax return document as it was. Be sure to submit all the necessary documents like your federal returns, W-2 documents, etc.
Never mail the check or send cash with the return. Filing returns online is easier and more convenient.
Why You Should Consider Filing Your Taxes Online
The internet makes everything easier and better when filing returns. It is way more convenient to settle your IRS obligations through their online platforms. Here are reasons to file tax returns online:
1. File anywhere at anytime
Convenience is the biggest benefit of filing returns online. You do not need to go to your local offices or the mail. Instead, you can access the portal from your phone or computer.
You can file your returns from other states or overseas online. The online platform makes everything better.
2. It is cheaper to file taxes online.
Filing tax returns online is free! You do not need to pay anyone to do it for you. All you need is a secure internet network and a phone or computer.
It saves you money that tax stores would otherwise have charged you. You shouldn’t pay tax returns if you do not have to.
3. It is easier than it looks.
Many people assume that filing returns online is difficult. It would be best if you did not get discouraged.
Once you file your returns yourself, you will be surprised by how easy it is. The filing portal lays everything, and you should easily get through the filing process.
4. You don’t have to deal with annoying refund delays
People who file returns online receive their tax refund faster. Online refund processing takes place much faster.
Mailing refund checks take time as the postal service is normally quite busy. To get your money back faster, file your returns online through the IRS portal.
5. Correct filing mistakes quicker
When filing returns, you may accidentally make mistakes. It can be through entering the wrong names, social security numbers, etc.
It might take weeks before the IRS flags these inaccuracies when filing through the mail. With the online filing, the system notifies you immediately that there are errors. It allows you to correct these errors faster.
6. Keeping records
Once you have successfully filed your returns, the IRS issues you with a compliance document. It is sent directly to your email, where you can easily retrieve it or make a physical copy. Having a digital copy is great as you can always print it from your email.
What Challenges Might You Face When Filing Taxes Online?
Filling taxes online is truly beneficial. You do not need much to get through the filing process. There are, however, some limitations to the process. They include:
Documents must be in the correct format
When filing tax returns, you might need to attach some documents. It can be challenging if you don’t have scanned copies of the documents.
You need to ensure that the documents are in the proper format when uploading them to the IRS portal.
Some formats may not be supported either. Ensure you check the list of supported formats before submitting your final copy.
You should have basic computer literacy.
While most folks can use a computer, some people might struggle with it. You need to have a basic understanding of using the technology to file taxes online.
If you do not understand how to upload documents or access the portal, you will struggle. You also risk filing incorrect returns if you do not know how to use your computer right.
The risk of data loss
When accessing the IRS portal or opening files from the internet, you need a secure location. When using public networks, it is easy for people to access your private and sensitive tax information. Ensure you file returns from your home or a network that you trust.
The IRS sends compliance forms to your email. You might delete these files if you do not keep an organized inbox. They may also get lost in the clatter.
What Constitutes Tax Fraud?
Section 7201 of the Internal Revenue Code outlines tax fraud offenses. Anyone who commits tax fraud can get prosecuted in the United States.
The IRS works with law enforcement to investigate tax evasion and money laundering crimes. What are the tax offenses?
Employee underreporting is a typical sort of tax fraud. Some employers are guilty of lying about the number of employees they have. It may be because these workers are illegal or underage.
Employers must pay a payroll tax every time wages or salaries get paid. The majority of these funds go to welfare and healthcare initiatives. By failing to register the number of employees, they can avoid paying these taxes.
Cash payment fraud
When employees pay their bosses in cash, this happens. As a result, they might underreport the number of workers or make false welfare contributions. When workers get cash compensation, they might also avoid paying taxes.
Employees who get paid in cash are more likely to perpetrate fraud. Workers are urged to accept bank payments rather than cash.
Fake tax claims
Making fraudulent tax claims to the IRS is considered fraud. What is the definition of a fraudulent tax claim? It entails falsifying your tax return to lower your tax liability.
Faking tax returns is unlawful and may result in significant consequences. Depending on the severity of the deception, you may face harsh consequences. Always keep an accurate record of your returns.
Intentionally not paying taxes
Intentionally avoiding paying taxes is a typical sort of fraud. It entails failing to meet tax payment deadlines. It is usually due to the payer’s carelessness rather than an intentional act.
You risk receiving a penalty if you do not pay your taxes. Set monthly tax payment reminders to prevent the drama.
Refund fraud offenses
False tax claims lead to refund fraud. The IRS may reimburse some of your taxes if you file a fake return. The fraudster usually fabricates the number of children and income levels, including fictitious deductions.
Businesses that commit refund fraud inflate their revenue statements with fictitious expenses. Refund fraud perpetrators take advantage of the system. They defraud the Internal Revenue Service.
Employer-related tax fraud is known as employee leasing. It’s comparable to payroll fraud. The only distinction is that companies outsource their payroll functions. It takes place via a middleman.
Outsourcing isn’t a deception. Fraud occurs when a middleman fails to send payroll taxes to the IRS. Many outsourcing companies use this to avoid paying taxes.
Not filing tax returns.
The Internal Revenue Service requires you to submit your tax amount and income. It demonstrates that you are tax-aware.
Apart from demonstrating compliance, tax returns are essential in many ways. It enables individuals and businesses to budget for their tax obligations. You can plan how to pay your taxes by looking through your income or income statements.
Tax returns can tell you if you’ve overpaid your taxes. Examining your tax returns will reveal whether your income decreased between the two tax seasons.
Underreporting foreign assets.
Did you know that if you have money in a foreign bank, you should report them to FBRA? Foreign Banks and Financial Accounts Reports is an organization that deals with foreign assets. It must guarantee that the IRS gets updated on your overseas holdings.
You must record these assets, even if they are subject to a different tax system. If you have less than $10,000 in your accounts, you do not need to report it.
Do I staple my tax return? No documents should get stapled to your tax returns. The actual tax return paperwork should be left unaltered. Ensure you include all required papers, such as federal returns and W-2 forms. Never send cash or a cheque with the return.
The IRS uses these key papers to determine your income level. The IRS will bring criminal charges against you if you fail to file proper returns.
When sending additional documents to the IRS, ensure you staple them separately from your tax returns.