The Secret Algorithm Behind An IRS Audit Reveal

VIDEO TRANSCRIPTION – The secret algorithm behind an IRS audit reveal, Hi, I’m Steven D. Cooper, your tax strategist. Also known as Coach Coop, with Coopers Accounting Service. Because your financial freedom matters. 

If you’d like to learn more great tax tips, download our popular financial guide at our website, yourfinancialfreedommatters.com or click on the link below this video. I get these questions quite often what clients can sign with the IRS audit. I asked them a simple question. If you work for the IRS, who would you audit?

The person that makes $250 a year, the person that makes $500,000 a year, or the person that makes $1 million a year? Almost 100 % of them say the person that makes $1 million a year. I say, how come? They make the most money so they can pay back the money faster. Okay. Now, if you don’t even make $250 a year, then why are you concerned with the IRS audit?

They’re not politely giggled with them because you’re not at $250 yet. I had this conversation with a client that grosses $80,000 a year. She’s very concerned with the IRS audit. She got five W-2s. She’s got a business and but she only makes $80,000 a year. That’s the big trigger. So even though you got five W-2s, you worked in different states, that’s really irrelevant

Going back a few years ago when Biden was president, several people were concerned with the Biden rule for an IRS audit. His rule was quite simple, yet complex. If you made above $400,000, meaning it was your taxable income, you had a chance to be audited. So a lot of people were afraid about this for the ones that made over $400,000 a year. 

There’s a famous athlete, I’m not going to use his name, but I’m going to use how his tax returns are done. His tax returns are usually taller than most people’s desks or tables. Very complicated tax returns because his revenue comes from different sources. The IRS computer cannot scan and read it because it’s that complicated.

That’s where the $400,000 rule comes in that you will need a physical personnel from the IRS to be able to read his tax returns. I have a client who’s a lawyer, makes about $2 million a year, he owns six rental properties. His net income is roughly little bit over $600,000 a year, but his tax returns can be scanned through the IRS and it’s readable and it makes sense.

So yes, he makes over $400,000 a year, but his tax returns are not complicated. That’s the different examples that I want to give to you when it came to the Biden rule about being over $400,000 a year. Once again, for the people that make less than $250,000 a year, I want to harp on one word, mindset.

They’re concerned about this. There are times that you can put your energy out there and you put it out there so much where, as they will say, the universe will capture it. For my clients to make above a million dollars a year, different mindset, different energy that they’re putting out. 

They’re not trying to live life through the rear view mirror. They’re living life through the big mirror. Remember, it’s going to be a little challenging unless you’re a professional stunt driver or driver period to be able to drive from the rear side of the mirror if you get my drift.

So it’s once again the mindset. It’s one of the biggest things and now my third word that I bring up now. Remember, first two words were choices, being in balance. Now the third word which I added about two months ago is mindset. You have to have a positive mindset.

Negative mindset brings in negative energy. Positive mindset brings in positive energy. It also brings in positive people in your life as well too. I say all of these things because I see it, I believe it, and I have been victimized by the negative mindset on my own choices and I’ve bring about positive mindset through my own choices as well too. 

So remember mindset and energy that you bring to the table. Both of those bring value to your world if you get my drift.

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If you’d like a free 20-minute smart money consultation, call ⁓ us at 562-436-2600. Well again, I’m Steven D. Cooper, your tax strategist with Coopers Accounting Service.

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