Tax Audit in Fort Collins, Colorado

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Tax Audit Lawyers in Fort Collins

A "tax audit" in Colorado is the process by which the proper tax authorities (either the IRS, at the federal level, or its state equivalent) investigate a tax filing in more detail than they do for ordinary filings, typically because there appears to be a discrepancy, or some other suspicious item, in somebody's tax returns. However, the IRS (and state tax authorities) sometimes do rounds of unexpected audits, where they audit taxpayers at random, without necessarily suspecting them of any wrongdoing.

The process of a Fort Collins, Colorado tax audit is typically pretty straightforward. If and when you are faced with a tax audit, you'll receive a letter from the IRS, or its state equivalent, telling you that you're being audited. Nonetheless, you should not assume that this letter is authentic, because con artists will sometimes send fake audit letters to squeeze money out of innocent taxpayers. You should pursue independent confirmation of the letter's authenticity by searching the Internet for the name of the government agency in question, and contact them for more information.

After confirming that the letter informing you of your audit is authentic, there are various things you can do to prepare for your meeting with the auditor. The initial thing you need to do is call them and arrange to meet at a time that's mutually convenient. You should bring any documents and records that the auditor requests, as well as any proof that you think might be helpful in answering the auditor's questions. The auditor will ask you any questions that he or she believes will clear up whatever concerns they have with your return. You should answer all of these questions truthfully, as it is illegal to lie to a tax auditor.

Reasons For a Tax Audit in Fort Collins, Colorado

There are numerous reasons why the federal government, or the government of Colorado may want to audit a taxpayer.

As considered earlier, tax audits can be conducted at random. Apparently, the government doesn't have the resources to audit every taxpayer under their jurisdiction. But, by conducting a substantial number of random audits each year, taxpayers are, in theory, discouraged from cheating on their taxes, because they know that they might be audited randomly. If you are chosen for a random audit, and have done everything right, you almost definately have nothing to worry about.

Nonetheless if the IRS or other tax agency suspects actual wrongdoing by a Fort Collins, Colorado taxpayer, that's a different matter. There are numerous different reasons why a government might determine to audit a taxpayer. The most typical one is suspicion that they have underreported their income. If a taxpayer buys a considerable number of expensive luxury items, but reports little or no income on their tax returns, the government will definitely want to discover where the money to buy all those things came from, and why it hasn't been declared as taxable income.

It is also typical to be audited in Fort Collins, Colorado if you claim a large number of deductions. A tax deduction is simply a legal subtraction from one's taxable income. Numerous different expenses, including charitable donations, interest paid on mortgages, and others, are deductible from one's taxes. If you claim so many deductions that you have negated almost all of your tax liability, you can bet that the government is going to be suspicious.

How Can A Fort Collins, Colorado Tax Lawyer Help?

If you find yourself on the business end of a tax audit in Fort Collins, Colorado, and you are sure that you have reported all of your income, and not claimed any invalid deductions, chances are you were just chosen at random for an audit, and you likely don't have any cause for concern, other than the inconvenience that an audit represents. If you are deemed to owe any back taxes, and your failure to pay in the past was the result of an honest mistake, you'll likely be afforded a chance to pay any taxes you owe from past years, with the possible addition of interest.

However, there are times when an audit is conducted to investigate far more significant issues. If you find yourself facing allegations from the IRS of serious wrongdoing, and believe yourself to be innocent, you should pursue the advice of a Fort Collins, Colorado tax attorney immediately.

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Life in Fort Collins

Fort Collins is a medium-sized city. It is a home-rule municipality, meaning that it is not part of any county, and the state of Colorado has delegated some of its authority to the city, which the city can exercise within its own borders. It has a population of about 137,000. Fort Collins is generally known as a college town, being home to Colorado State University. The city of Fort Collins frequently ranks near the top of Money Magazine's list of best places in the U.S. to live. Because of the large college-aged demographic, Fort Collins has a thriving music and art scene, as well as a large number of well-regarded microbreweries. Fort Collins has a healthy and diverse economy, with major employers such as Colorado State University, Hewlett Packard, AMD, Wal-Mart, and many others providing thousands of public and private-sector jobs, in a wide variety of fields. Given its size, diversity, and vitality, it should come as no surprise that, with all the business that's done in Fort Collins, there are sometimes legal issues. For that reason, it shouldn't be a surprise that there are many Fort Collins, Colorado lawyers who are very skilled. If you're facing a legal issue, a Fort Collins, Colorado lawyer can help.

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