5 ms·
Even on the principle? I've negotiated successfully to reduce or scrap penalties for things like late return lodgement or late payment, but never had them budg
by markdown 9y ago
Even on the principle?
I've negotiated successfully to reduce or scrap penalties for things like late return lodgement or late payment, but never had them budge a dime on the tax owed.
- throwaway613834 9y agoI think you mean "principal"? (Got very confused reading your comment since I thought you were objecting to the concept in principle.)
- markdown 9y agoOoops, you're right of course. My mistake.
- sjg007 9y agoI would probably depend on how you calculate what is owed.. You have one theory and the IRS has another etc...
- seanmcdirmid 9y agoThe IRS makes mistakes also, e.g. your foreign tax credit gets lost. Their collections people are super understanding, it made a very stressful time much more bearable.
- charlesdm 9y agoGenerally things get fuzzy when analyzing multiple laws together, which leaves room for interpretation. One simple hypothetical example: capital gains are taxed at 20%, unless investing is your profession, then it is taxed as income at 40%. Seems easy enough, right? Random guy A works as a part time teacher, making $20k a year (taxed at 40%) but also makes $1m a year from investments (taxed at 20%). It is a ridiculous example, but what is your profession? Are you a teacher, thus paying 20% on your investments? Or are you an investor, having to pay 40% on all of your gains? You can be certain your friendly local tax authority wants to classify you as an investor. And you want to be classified as a teacher, thus paying the lower rate. But it could also be a loophole for a wealthy person to avoid taxation at 40%. Unless they are certain they will get it right in court, there's a good chance you could make a deal and settle your dispute.