7 Money Moves You Should Never Hide From Your Tax Preparer
byMar 1st 2013 5:00AM
Not to be pessimistic, but it's safe to assume that not every taxpayer is 100 percent truthful when it comes time to fill out their tax returns.
In a 2011 IRS report, twice as many Americans (8%) said a little fibbing on tax returns is fine compared to the same survey issued in 2010.
And although it's true that the IRS doesn't exactly go after "small potatoes" taxpayers for fibs (generally, you'd need at least $1 million in assets to interest their auditors), even a few missing details could put your refund in jeopardy.
Whether you're going solo or working with a tax professional this year, transparency is the key to getting the maximum refund –– and keeping auditors off your tail.
Here are seven "confessions" we recommend making soon if you haven't already:
- "I made a nondeductible contribution to a traditional IRA."
- "I've earned income outside of my regular 9-to-5."
- "I converted my IRA to a Roth IRA in 2012."
- "I rented out my apartment to get through the housing slump."
- "I exercised employer stock options (or received restricted stock) and then sold the shares right away."
- "I earned interest from municipal bonds."
- "I've had credit debt forgiven by debt collectors."
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