Congress Wants to Start Tracking Your Credit Card Transactions
by: Anthony Parent
Congress has recently proposed a controversial bill that would require credit card companies to report payments made to merchants for credit card and debit card transactions to the IRS. The idea is to catch tax cheats, but opponents of the bill doubt that such regulations would actually catch anyone cheating. Companies that cheat on their taxes usually do so by failing to report cash transactions, not credit card transactions.
This bill comes as congress has been pressuring the IRS to close the tax gap - what Americans actually pay in taxes – and what they should pay. It’s estimated that underreported income is responsible for 80% of the tax gap – approx. $136 Billion to $158 Billion. But according to the IRS, “Most of the understated income comes from business activities, not wages or investment income.” So, in other words, the IRS is looking for “under-the-table” money – money that’s being made by sole proprietors, partnerships and S-Corporations that is not being reported as income.
Whether the current legislation makes it through a presidential veto remains to be seen. Either way, as you can see, the U.S. Government is coming for their money. If you are guilty of withholding payment from the IRS, chances are good that they will find out one way or another. If you suspect that your business is in trouble with the IRS, don’t risk having them shut down your business and put a swift end to your livelihood. By coming to a repayment agreement with the IRS, it’s more of a “hassle-free” method for the IRS than wage garnishments, bank account seizures, tax liens and other drastic measures.
If you would like to schedule a free, confidential consultation with us to discuss your tax issue, contact us. Call 888-727-8796 or email firstname.lastname@example.org.