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  • #16
    When can we go for a joyride?

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    • #17
      Originally posted by K82 View Post

      Put it towards another one of these:

      https://www.sanfranciscosportscars.c...lm-gt40-c-925/

      I built this car a few years ago in my garage and recently sold it to a guy in San Fran through the "Bring a Trailer" website. He has it listed for sale through this sports car site in San Fran. It was an amazing project that took me several years.
      Don’t title it.
      Scrap sales cash
      Cash for a nice boat- cash invoice
      Boat registration-
      IRS- where did this come from?

      Since you are going underground only for items under a few grand, going to be awhile!

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      • #18
        Originally posted by endo4jc View Post
        When can we go for a joyride?
        You just missed the window, it shipped 4 weeks ago to San Fran. It was fun to drive, 430 HP only weighing 2500 lbs. I was happy that I never got a ticket when flying around. It got a lot of attention when out and about, people taking pics and video of it. It was time for it to move on though, need more room in the garage!

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        • #19
          this sounds painful but 2 thoughts

          a) random, fairly painful audits are one of the ways that the IRS ensures that people follow the rules.

          b) i'm not sure i would have this extremely rare event push people towards just cashing checks and taking the greenbacks, esp since many of us owe taxes on those checks. most of my random check deposits are from IC income, i can't just cash them and spend it all.

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          • #20
            Originally posted by MPMD View Post
            this sounds painful but 2 thoughts

            a) random, fairly painful audits are one of the ways that the IRS ensures that people follow the rules.

            b) i'm not sure i would have this extremely rare event push people towards just cashing checks and taking the greenbacks, esp since many of us owe taxes on those checks. most of my random check deposits are from IC income, i can't just cash them and spend it all.
            Cashing is almost unspendable, unless you are buying drugs or a lot of groceries.

            My son had a $100 bill from a babysitting gig a couple months ago, and he could not wait to unload it on me for some real money, a $100 transfer to his debit card.

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            • #21
              Everyone keeps saying random, but there had to be something that would make this statistically more likely to happen right?

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              • #22
                A bad audit will put you on the list for reserved spot in 3 years.

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                • #23
                  Originally posted by Peds View Post
                  Everyone keeps saying random, but there had to be something that would make this statistically more likely to happen right?
                  The IRS agent thought it may have been generated due to some condo's we purchased for rental income but was unsure.

                  Just to be clear, I'm not suggesting avoiding paying taxes you owe by cashing checks instead of depositing them, I'm saying that its much easier if you get audited to not have to explain all of your minimal deposits over a year or more time. I pay the taxes I owe and so far the agent hasn't found any problems with my return.

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                  • #24
                    Our agent said that the NRP is completely random and done to make sure the randomness catches all forms and types of returns as the NRP goes line-by-line audit and chases sources of each line - it's the ultimate tracer

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                    • #25
                      Originally posted by K82 View Post

                      The IRS agent thought it may have been generated due to some condo's we purchased for rental income but was unsure.

                      Just to be clear, I'm not suggesting avoiding paying taxes you owe by cashing checks instead of depositing them, I'm saying that its much easier if you get audited to not have to explain all of your minimal deposits over a year or more time. I pay the taxes I owe and so far the agent hasn't found any problems with my return.
                      i still don't get how this is easier.
                      especially if these checks represent income.
                      if you have a $5k check deposit and you just say "i cashed that and spent it" does the agent just move on?

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                      • #26
                        Originally posted by vagabondmd View Post
                        my son had a $100 bill from a babysitting gig a couple months ago, and he could not wait to unload it on me for some real money, a $100 transfer to his debit card.
                        lolol
                        Our passion is protecting clients and others from predatory and ignorant advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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                        • #27
                          Originally posted by MPMD View Post

                          i still don't get how this is easier.
                          especially if these checks represent income.
                          if you have a $5k check deposit and you just say "i cashed that and spent it" does the agent just move on?
                          I have multiple deposits for various investment income, especially from that year when I was in Peer Street and Patch of Land and several other sources of income. Those were directly deposited into my account and though the IRS agent has asked me to clarify those deposits (seems odd to me since they are itemized on my return and are pretty self evident) they are easy to explain and show proof. There are a bunch of deposits where I had saved up checks and deposited them at one time from various sources like an ebay sale of an old item, a rebate for some Fram oil filters, rebate for Mobil oil, rent payement check, etc. Like I stated before, there isn't room in my check book to describe each of these items so I just entered: Deposit. Over three years later this becomes a pain in the rear to figure out what all of them were from. I wish I would have just cashed them out and spent the money. I'm not talking about a 5 K deposit from Broadmark Realty, that's easy to verify. Clearly everyone can do what they want, after experiencing this first hand I know what I'm going to do going forward. I just wanted to warn others of this treatment you may be getting sometime in your life.

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                          • #28
                            So if you didn't report income from surveys (<$100), would they really say that you should've reported that? I find it hard to believe that they would care about me not paying 0.05% of my taxes. If they are targeting people for <1% of their total tax bill, then that's ridiculous and a waste of resources.

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                            • #29
                              Originally posted by southerndoc View Post
                              So if you didn't report income from surveys (<$100), would they really say that you should've reported that? I find it hard to believe that they would care about me not paying 0.05% of my taxes. If they are targeting people for <1% of their total tax bill, then that's ridiculous and a waste of resources.
                              A few things to consider:
                              1. Auditors are people, just like you and me. An auditor might have a bias against you or think you act just like his/her cheating ex-spouse or whatever. Not saying to expect that (the auditors I’ve worked with have, without exception, been fair, decent and hard-working), but we all have to fight hidden biases, right?
                              2. An auditor is not simply looking for absolute differences - their cpu systems are fairly sophisticated at flagging those calculations. They are also looking for patterns and probabilities. Fail to report $100? What else are you “overlooking”? Does this indicate a cavalier attitude toward authority? Is this a clue you are playing fast and loose with audit lottery? This is actually how my mind works (have always thought it would be a lot of fun to practice forensic accounting, so I can relate).
                              3. Maybe you’ve been reported by a disgruntled former employee and the IRS targets you as an ultra HIP doctor and the agency will not let go of that bone until they are sure the marrow has been sucked out.
                              4. Etc. Etc. Etc.
                              To me, believing an auditor is happy to find a $100 omission and pack it up is (with all due respect, seriously) naive. People tend to think of Leona Helmsley, Wesley Snipes and other famous “examples” but you s/n assume you’re scot-free just b/c you don’t pay 7 figures in taxes. The new-making cases require tremendous resources. You? Far less cost and involvement. You might be surprised at how much a really sharp auditor can turn up. Please understand, it can be a harrowing, distracting, stressful ordeal for the whole family being audited.

                              For the record, I do NOT seek to be a fear-monger to get attention. The purpose of this post is to address the misconception that the IRS is simply trying to stay busy and finding a few dollars here and there before moving on is a satisfactory result.

                              Again, southerndoc , this is not a personal attack on your comment, but a general commentary!
                              Our passion is protecting clients and others from predatory and ignorant advisors. Fox & Co CPAs, Fox & Co Wealth Mgmt. 270-247-6087

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                              • #30
                                I guess it is easier to keep documentation of all your cash transactions. FYI, tax record keeping requirements do not have a lower limit (under a grand or two).
                                The attributes in an IRS audit is pretty simple, documented or not. From an IRS perspective, if the cash is not important then don't cash the check.

                                One suggestion is to simply make a copy of the back of the deposit slip. If you have miscellaneous deposits once a week, that is 52 pieces of paper. I'd put that in my tax return document file. That way if the IRS wants something there is no digging. The concern is if a Fram Oil filter rebate leads to suspicion of a pattern of non-reporting of taxable income, you won't have an easier time. Not judgemental, simply then the task becomes a challenge for the IRS.

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