The IRS to Audit the Easter Bunny!
The Easter Bunny has received horrible news just days before he is scheduled to make his egg-hiding rounds this year. The IRS is cracking down on Sole Proprietors, such as The Easter Bunny, The Tooth Fairy, and possibly even Santa Claus regarding excessive tax write offs, especially in the mileage claimed for business use.
Are you Treating Your Business Like a Hobby or a Business?
Why Your Business Should Never Be a Sole Proprietorship!
What is the #1 Reason the IRS Goes After Business Owners?
The following is the number one item the IRS looks for when going after distributors: Failure to use financial records analytically! The key is to use your financial statements to track the progress of your business. That would include a budget, cash flow statement and acccounting system.
NCP offers a turn key system for entpreneurs to incorporate your business properly, provide an Annual Tax and Bookkeeping Program, a rock-solid tax course to help keep the IRS off your back!
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For Immediate Release:
The IRS to Audit the Easter Bunny
Las Vegas, NV March 19th, 2008. The Easter Bunny has received horrible news just days before he is scheduled to make his egg-hiding rounds this year. The IRS is cracking down on Sole Proprietors, such as The Easter Bunny, The Tooth Fairy, and Possibly even Santa Claus regarding excessive tax write offs, especially in the mileage claimed for business use.
These characters apparently never set up the right corporate structures to protect themselves and decided to operate as the most simple business form, the sole proprietorship.
Unfortunately, the sole proprietorship has the most liability, least tax benefits and the most possibility of negatively affecting ones revolving debt and future ability to develop business lines of credit. Even the Easter Bunny can not afford to ruin his personal credit by using personal credit cards to finance his Easter Egg Business!
Why is a sole proprietor most likely to be audited?
The IRS believes there is a $300 BILLION tax gap --- $300 BILLION in uncollected taxes --- each year! The biggest culprit? Not large corporations, but small business owners. In fact, sole proprietorships are 300% more likely to get audited than someone who does not file a schedule C!
It is important that any business owner also document their records properly. In fact, the Easter Bunny may have excessive claims of business mileage especially since he has never owned a car.
Solution: Run your business like a business. Document all your business expenses, use QuickBooks® or some other accounting software to operate your business, and DON’T operate as a sole proprietorship! Incorporating is a much better approach.
Scott Letourneau of Nevada Corporate Planners has been called by the Famous 3 to see how they can correct their situation for the future. Mr. Letourneau says, “The Easter Bunny has concerns also over protecting his Egg-sets (Assets) and his business that just can not be done in his current Sole Proprietor Status.
Update: A drunken Leprechaun faced an IRS audit this week for similar reasons and did not fair well after St Patrick’s Day!
Scott Letourneau is the CEO of NCP, Inc. and an authority in helping entrepreneurs get their businesses off to a fast start to profits. His company provides a turn key solution from forming the corporation or LLC, business credit, tax and bookkeeping support and many other ways to help your business. His Top 5% Club is highly acclaimed by business experts around the country.
Contact:
Nevada Corporate Planners
1-888-627-7007
scott@nvinc.com
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