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Retirement tax questions
Thank you for your responses.
Let me give you an example. Imagine I'm a bad guy. Imagine I made some work or service to someone and he paid me $1000 for my service via checking-to-checking transfer. Then I bought something on Amazon online for the same $1000 using my credit card. After that I can say to IRS that I bought this thing on Amazon for that person (not for myself) and the person just reimbursed my expenses. So it's potentially a way how to avoid paying taxes. So should I prove to IRS that I'm not a tricky guy? In case of random audit they would see some transfer from someone to my checking account and it would not be clear the nature of this transfer.
So in this situation (of audit) IRS would need to prove that I'm a liar or I would need to prove that I'm honest? At least could they require some explanations from me in writing about the nature of this money I received?
So how would they separate good guys from bad guys?
P.S. to the 1st Carl's message. I'm not planning to fill up the amount that I paid with my credit card into any IRS form (so obviously I'm not going to ask for tax deduction) -- if I understood you correctly
Let me give you an example. Imagine I'm a bad guy. Imagine I made some work or service to someone and he paid me $1000 for my service via checking-to-checking transfer. Then I bought something on Amazon online for the same $1000 using my credit card. After that I can say to IRS that I bought this thing on Amazon for that person (not for myself) and the person just reimbursed my expenses. So it's potentially a way how to avoid paying taxes. So should I prove to IRS that I'm not a tricky guy? In case of random audit they would see some transfer from someone to my checking account and it would not be clear the nature of this transfer.
So in this situation (of audit) IRS would need to prove that I'm a liar or I would need to prove that I'm honest? At least could they require some explanations from me in writing about the nature of this money I received?
So how would they separate good guys from bad guys?
P.S. to the 1st Carl's message. I'm not planning to fill up the amount that I paid with my credit card into any IRS form (so obviously I'm not going to ask for tax deduction) -- if I understood you correctly
May 31, 2019
5:52 PM
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