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1.
A tax levy _______.
Seizes property in order to satisfy a tax debt. A levy is used when there are no other alternatives to get back taxes paid.
2.
What is the most common IRS audit flag?
Math mistakes. Reviewing your return can reduce your chance of getting a letter from the IRS.
3.
When being questioned by the IRS during an audit, providing more information than is being asked for is an excellent strategy for winning.
False. The audit agent doesnt need that information, and he or she may even open up another investigation on you.
4.
When considering your options for dealing with a tax bill that you cant pay, remember that _______ will be added to your tax bill until it is resolved.
Interest and penalties. Although the IRS may be willing to negotiate a settlement of your tax bill, there will generally be added penalties and interest charged for the unpaid balance.
5.
Which type of IRS audit takes place by mail?
Correspondence audit. This type of audit usually asks you to clarify something on your return.
6.
Why is the home office deduction an audit flag?
Office space often gets used for personal purposes. Personal use invalidates its purpose as home office space.