An article quietly released on November 17th by Bloomberg is now starting to circulate and get attention. The Internal Revenue Service (IRS) says they are going to ramp-up 50% audits on small businesses next year.
An agency official said these audits will be coming from years of following persistently low examination rates.
The article states, The result could be a surge in audits of companies ranging from mom-and-pop retail stores and technology startups to investment funds that have historically faced only infrequent checks thanks to the time and effort required at the IRS.
The IRS is focusing our efforts to increase compliance activity in this area of not only partnerships, but also investor returns related to pass-throughs. We are planning for 50% more than we had in the previous year.
De Lon Harris. IRS deputy commissioner of examination for small businesses
Pass-through entities, which include partnerships, limited-liability companies and sole-proprietorships, are incredibly difficult for the IRS to audit because they frequently have complex structures that can involve dozens of inter-related entities. Pass-throughs don’t pay taxes themselves, but “pass” along the profits and tax liabilities to investors — who then pay the taxes on their individual returns.
A 50% increase in the number of new audits next year could still mean that the agency has a long way to go to resume higher audit ratios, because it’s starting from a low base. The IRS audited only 140 partnership returns of the more than 4 million returns filed in 2018 — less than 0.00004% — according to the most recent data from the agency. That’s down from about 0.5% of partnership returns that were audited in 2010.
For S corporations, another type of pass-through entity, the IRS audited 397 returns — roughly 0.01% of all filed — in 2018, according to agency data.
The IRS is hiring 50 more specialized auditors to work these cases, with the aim of having them in place by February, Harris said. The IRS can select returns to audit that are up to three years old. If the agency finds significant problems in a taxpayer’s filings, the auditors can examine returns that are even older.
New audit procedures that Congress approved in 2015 mean that the IRS can more easily collect any underpaid taxes it finds during the audit. Instead of having to track down each investor, the IRS can now collect the money from the partnership itself.
AUTHOR COMMENTARY
If you are still not convinced that the Covid-19 “pandemic” is just a masquerade for the greatest wealth transfer in the history of the world, I cannot help you. The data is in, and Covid-19 continually proves to be nowhere remotely close to being lethal.
2021 will not be getting any better. Small business and the middle class have gotten absolutely obliterated this year. 2021 is shaping up to be the dagger that will final cull off the rest of small businesses that are in the way.
When the shutdowns began and have stretched to now and into the guaranteed future, did you see the big corporations shutdown? Did you see Amazon, Wal-Mart, Target, Costco, Starbucks, McDonalds, Taco Bell, Dominos, Lowes, Home Depot, Hollywood, shutdown and stay closed up? No, you didn’t.
Fascism should rightly called Corporatism, as it is a merger of corporate and government power.
All within the state, nothing outside the state, nothing against the state.
Benito Mussolini
When Fascism came into power, most people were unprepared, both theoretically and practically. They were unable to believe that man could exhibit such propensities for evil, such lust for power, such disregard for the rights of the weak, or such yearning for submission. Only a few had been aware of the rumbling of the volcano preceding the outbreak.
Erich Fromm. Escape from Freedom
The rich ruleth over the poor, and the borrower is servant to the lender.
Proverbs 22:7
The rich man’s wealth is his strong city: the destruction of the poor is their poverty.
Proverbs 10:15
We all need to continually prepare for what is coming next. 2021 is, unfortunately, going to be a nightmare for many. This year was child’s play.
By faith Noah, being warned of God of things not seen as yet, moved with fear, prepared an ark to the saving of his house; by the which he condemned the world, and became heir of the righteousness which is by faith.
Hebrews 11:7
You have been warned, and so hopefully you have been building your “ark to the saving of [your] house.”
However, in these dark and distressful moments, that is when the Lord gives us joy and peace that we never thought possible. All you have to do is trust in him will all your heart, soul, spirit, mind, and strength, and he WILL provide and fight for you – never forget that.
[12] Blessed is the nation whose God is the LORD; and the people whom he hath chosen for his own inheritance. [13] The LORD looketh from heaven; he beholdeth all the sons of men. [14] From the place of his habitation he looketh upon all the inhabitants of the earth. [15] He fashioneth their hearts alike; he considereth all their works. [16] There is no king saved by the multitude of an host: a mighty man is not delivered by much strength. [17] An horse is a vain thing for safety: neither shall he deliver any by his great strength. [18] Behold, the eye of the LORD is upon them that fear him, upon them that hope in his mercy; [19] To deliver their soul from death, and to keep them alive in famine. [20] Our soul waiteth for the LORD: he is our help and our shield. [21] or our heart shall rejoice in him, because we have trusted in his holy name. [22] Let thy mercy, O LORD, be upon us, according as we hope in thee.Psalm 33:12-22
[18] The LORD knoweth the days of the upright: and their inheritance shall be for ever. [19] They shall not be ashamed in the evil time: and in the days of famine they shall be satisfied. [20] But the wicked shall perish, and the enemies of the LORD shall be as the fat of lambs: they shall consume; into smoke shall they consume away. [21] The wicked borroweth, and payeth not again: but the righteous sheweth mercy, and giveth. [39] But the salvation of the righteous is of the LORD: he is their strength in the time of trouble. [40] And the LORD shall help them, and deliver them: he shall deliver them from the wicked, and save them, because they trust in him.Psalm 37:18-21, 39-40
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