IRS Plans to Look at Small Builders More Closely
By Krista Mund
The Internal Revenue Service (IRS) is hiring more examiners to specifically pursue small businesses.
Ann Makres, senior stakeholder liaison with the agency’s small business/self-employed division, told builders during an informational session at the Home Builders Association of Fargo-Moorhead, N.D. that small businesses and self-employed people will be looked at more closely because many are not reporting all their business income, overstating business expenses or underreporting self-employment tax.
According to the IRS, the overall tax gap ― the difference between what taxpayers should have paid and what they actually paid — came to $345 billion in 2001, with almost 43% of that gap attributable to small businesses and self-employed people.
The IRS offers many resources to ensure that your business is in compliance with all IRS regulations. The following is a summary of some materials available through IRS:
- The Small Business Resource Guide 2006 containing information organized around the life cycle of a business
- A Virtual Small Business Tax Workshop DVD
- Individual Retirement Arrangement (IRA) Resource Guide for Small Business Owners and Individuals
- A brochure on the electronic federal tax payment system (EFTPS) that allows business to make payments online or by phone
- A brochure addressing tax considerations if you are considered an employee versus an independent contractor
- A brochure including tax information for small construction businesses
- Construction industry federal taxation curriculum that contains an overview of the federal income and employment tax laws as they pertain to construction
For more information from the IRS, click here to get to the Construction section, or go to www.irs.gov and click on the Businesses header, then Small Businesses/Self Employed, Industries/Professions in the navigation column and Construction.
Makres also said that information addressing topics like independent contractor/employee, depreciation and employment taxes could be found under the top header, Instructor’s Educational Materials.
This article was revised and reprinted with permission from the Home Builders Association of Fargo-Moorhead. Krista Mund is the communications coordinator for the association. For information about the HBA, call 701- 232-5846, or visit www.hbafm.com.