Monday, January 14, 2008

$2500 Employee Expense Deductions

There is a national tax chain claiming that they are finding taxpayers an average of $2,500 in employee expense deductions. That number seems high to me so I went to search for more information. I can't find a claim like that from the company in writing so I am lead to believe one of three things:

1. The claim is bogus.

2. The claim is made with certain exceptions to be understood or is meant to apply only to certain types of taxpayer which makes it bogus.

3. The claim includes returns with clearly falsified information.

The third scenario is interesting because this company makes most of its money from non-tax related services. Tax returns are just a vehicle to get people in the door to sell them a mortgage or insurance or some other product. Also, this company pays out millions of dollars in legal settlements and tax related penalties each year. About 6 years ago the company recieved a scathing letter from the president of the American Institute of CPAs questioning some of its practices and professionalism.

Maybe I'll have an answer shortly about the company's claim that I can discuss further. But about those people who are deducting more the $2,500 in employee expenses what kind of documentation are they able to provide? This is what comes to my mind.

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