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The IRS will send out Notice LT16 when the agency believes a taxpayer hasn’t filed their tax return or has unpaid taxes. Regardless of what they think they have or haven’t done, taxpayers should respond to the notice. Failure to communicate with the IRS could result in continuing action against the taxpayer and limit their options for resolving the issue.

When taxpayers underpay their taxes to the IRS, they have to pay interest on the underpaid amount. The same is true when a taxpayer overpays their taxes, and the IRS owes them money.

The majority of audits that the IRS conducts are resolved as civil matters. Some, however, may transform into criminal investigations that can potentially lead to criminal charges and prosecution. If a taxpayer is convicted, they can face significant federal penalties, up to and including jail time.

The Foreign Investment in Real Property Tax Act of 1980 (FIRPTA) requires any sale or disposition of U.S. real property interests that involves a foreign seller to submit 10 or 15 percent of the sale price to the IRS for withholding. While the tax debt is the seller’s, it’s the buyer’s responsibility to send the withholding amount to the IRS.

One of the quirks of FIRPTA is that the buyer, even if a U.S. citizen or domiciled corporation, is responsible for withholding the required amount and sending that amount to the IRS. The buyer is also generally responsible for completing and submitting Form 8288 or Form 8288-A.

One of the commonly known rules about our criminal justice system is that spouses can’t be forced to testify against each other. What’s less known is how one spouse’s tax debt can affect the other spouse’s assets.

For some people, filing for bankruptcy is the best choice for getting a clean financial slate.  Before opting for that choice, however, individuals should be aware of all of the pros and cons of filing, including timing requirements related to discharging tax debts.

If a taxpayer has a debt forgiven, discharged, or cancelled for less than the amount owed, they generally have an obligation to report the taxable amount of debt as ordinary income on their tax return.

Like much of the tax code, FIRPTA sounds simple on the surface but has quirks and twists that can make navigating it challenging. These are some of the common questions that taxpayers ask about FIRPTA.

When the seller of a U.S. real property interest is a foreign national, the Foreign Investment in Real Property Tax Act of 1980 (FIRPTA) applies to the sale and determines applicable taxes. In general, any sale that falls under FIRPTA requires withholding of 10 or 15 percent of the gains from the sale. Even if a property sells at a loss, in general, the buyer must still withhold 10 or 15 percent of the sale price.

The Foreign Investment in Real Property Tax Act of 1980 (FIRPTA) governs real property sales when a seller is a foreign national. In general, any sale that falls under FIRPTA requires withholding of 10 or 15 percent of the gains from the sale. The IRS defines real property as land or improvements to land. FIRPTA’s definition of real property includes that meaning but expands beyond traditional real estate sales.

The IRS considers money earned from renting property as a form of income. This means that it can be taxed similarly to other types of income.

The IRS Automated Underreporter Program (AUR) is the name for the computer program that reviews and compares tax returns against information supplied by third parties to the IRS about that taxpayer. The AUR includes all types of reportable income, ranging from wages to dividends.

To file taxes, all taxpayers should have a Taxpayer Identification Number. For U.S. citizens, their Social Security number is their taxpayer identification number. Foreign nationals still have to pay taxes, but they don’t have a Social Security number. Individual Taxpayer Identification Numbers (ITINs) fill in the gap. Individuals who don’t qualify for a Social Security number can apply for an ITIN.

The gig economy has changed how both businesses and workers operate. While businesses may employ more freelance workers, that doesn’t change the importance of properly identifying employees versus independent contractors for tax and legal purposes.

One unexpected quirk of the tax code is that, in some situations, individuals can be personally liable for their company’s unpaid payroll taxes. Known as the Trust Fund Recovery Penalty, individuals who fall under it can face serious penalties.

The Foreign Investment in Real Property Tax Act of 1980 (FIRPTA) governs property sales when the seller is a foreign national. In general, any sale that falls under FIRPTA requires withholding of 10 or 15 percent of the gains from the sale.

The Foreign Investment in Real Property Tax Act of 1980 (FIRPTA) governs sales of U.S. real property interests when the seller is a foreign national. The law requires withholding a portion of the realized gain as part of the sale.

When a foreign national has an ownership or interest in U.S. real property and realizes a gain from the sale of that property, the Foreign Investment in Real Property Tax Act of 1980 (FIRPTA) comes into play. FIRPTA governs sales of U.S. real property interests when the seller is a foreign national. This law requires withholding as part of the sale.

Acquiring or selling real property based in the United States opens foreign individuals to tax liability to the IRS. Before purchasing or selling a property, individuals should understand how the transaction would impact their obligation to file a tax return with the IRS.

The Foreign Investment in Real Property Tax Act of 1980 (FIRPTA) guides real property sales when the seller is a foreign national who sells their ownership or interest in a U.S. real property interest. FIRPTA requires that sales that involve a foreign national seller must include withholding of either 10 or 15 percent of the seller’s gain from the sale. The majority of dispositions will fall under the 15 percent withholding requirement unless they qualify for an exception.

The Foreign Investment in Real Property Tax Act of 1980 (FIRPTA) governs property sales when the seller is a foreign national. The law’s general rule is that the gains of any covered sale include a 10 or 15 percent withholding. FIRPTA has exceptions, however, which can exempt a taxpayer from any tax liability.

When a taxpayer owes money to the IRS, the agency may go after assets and property that are managed or handled by third parties. A third party may receive notice of a levy related to an employee, vendor, customer, or other third party.

The disposition of a U.S. real property interest by a foreign person, known as the transferor, is subject to the Foreign Investment in Real Property Tax Act of 1980 (FIRPTA). This law provides guidance on a non-citizen’s disposition of a U.S. real property interest. These dispositions are subject to income tax withholding. FIRPTA authorizes the IRS to withhold income tax when foreign persons dispose of U.S. real property interests.

Cryptocurrency presents a new income stream for taxpayers, and some have failed to report it on their taxes. In response, the IRS Criminal Investigation Division is aggressively pursuing any cryptocurrency trader who fails to report income.