Q.  My income is too low to file a tax return.  Why is the IRS claiming I owe taxes?

A.  The IRS may believe that your income is higher than you do.  If you sold stock you probably need to file a tax return to tell the IRS how much you paid for the stock.  You know how much you made or lost, but the IRS does not.  Perhaps there is a bank, or brokerage, account that has your Social Security number by mistake.  If the income is wages, reported by an unknown employer, someone may be using your Social Security number illegally.

Q.  Wouldn't it be cheaper to use a local tax preparation service?

A.  Perhaps.  But you haven't, and now it has become a problem that may require more than just filling in the blanks on a computer and handing you your return.  We have to be competitive to remain in business.  We will tell you in advance what we think it will cost.  You are free to shop around, however, if you have unfiled tax returns the penalties and interest are increasing daily.

Q.  Do I need to use a CPA from my state?

A.  No.  You do not have to be a CPA in your state to provide tax services.  Anybody can open a tax preparation service and many are not staffed by CPAs.  It is important to note that CPAs often have more experience, in a wider range of taxes, than most other tax preparers.  CPAs are required to take continuing education courses to keep up with changes in accounting rules and tax laws.

Q.  The IRS is trying to collect payroll taxes that my company didn't pay.  Do I owe this?

A.  You may be personally liable for unpaid payroll taxes, or sales taxes.  Payroll taxes withheld from employees, and sales taxes collected from customers, are called "trust funds".  These funds do not belong to the business.  They are held "in trust" for the tax department.  A "responsible person" is someone considered to have the authority, or the ability, to remit these funds to the tax department.  Generally this is any officer of the company and any person who signed checks for the business.  If the business fails to pay these taxes the "responsible persons" may be required to do so.

Q. I have heard that the government cannot legally tax my personal income.

A. The authority of the United States government to tax income is granted by the 16th Amendement to the U.S. Constitution.  The government CAN legally tax your personal, and business, income.  There are many individuals, often referred to as "tax protesters" who ardently believe that income taxes are illegal.  These beliefs include such arguments as the 16th Amendment was not properly ratified, that wages are not "income" because they are a negotiated trade for your personal services, that our income tax is "voluntary" and they choose not to "volunteer" and, our personal favorite, that Title 26 of the U.S. Code (the Internal Revenue Code) does not define the term "sources", as in "sources of income".  There are many other variations which have been repeatedly tried, and repeatedly rejected, in the courts, including the U.S. Supreme Court.

Tax preparers are NOT agents of the government.  We prepare your tax returns based upon information which you provide.  We are not obligated to search for unreported income nor are we required to verify every deduction.  When you sign your income tax return you are attesting that the information on the return is, to the best of your knowledge, truthful.  It is your obligation to maintain sufficient records to support the information on the return and to provide that information if your return is audited.