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Tax time
(startrek.website)
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this post was submitted on 18 Nov 2023
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The IRS is actually testing a new system where they just tell you how much you owe/get, and that's it unless there's unreported income and such that needs to be corrected.
Also, the IRS only escalates straight to jail if it's incredibly obvious you're intentionally committing tax fraud. If your forms are wrong they just send you a letter to fix it.
I wish more people were aware of this. One year I made a rather significant number entry error and should have owed a couple thousand more than I paid. I got a fairly routine letter later in the year asking me to correct the error. I had a little mental panic, reran the numbers, and filed an amended return. There was no pressure, you always have payment options, and they send you back another letter confirming the acceptance of the amended file. I understand that many people would have significant problems paying extra unexpectedly but unless you are actively committing fraud you are not an immediate priority for the IRS.
Make sure you save all those letters, lest you resolve the error and get a letter several years later saying you owe $x + interest due to an error that you've already resolved. Because they don't have those records digitally, apparently, and if you don't have paper copies of every document involved you might just get to pay that penalty whether it was ever due in the first place, or even if you've already paid the penalty. Or get a lawyer.
Which is what happened to me the year before last.
Absolutely! I save everything when I comes to my money.
Yeah, those letters should follow the 3-2-1 backup rule. 3 copies in 2 different mediums with 1 stored off-site.