The IRS still "truncates" - or drops off the cents - on CP
2000 letters. I always thought it was nice of them. Also
saves money and time.

Nan, EA in LA

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- quote -

The IRP printouts used for audit files always truncated the
amounts (at least they still did when I left in 1994).

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- quote -

Well THANK you, Drew. For that was always my understanding
of how to do it, i.e. rounding either up or down with break
point at 49 cents.

Cheer$,
Harlan Lunsford

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- quote -

6102 actually gives the IRS discretion to require rounding
up or truncating. The option is not provided to the
taxpayer except if the IRS allows. The regulation
301.6102-1 states in part:

To the extent permitted by any internal revenue form or
instructions prescribed for use with respect to any internal
revenue return, declaration, statement, other document, or
supporting schedules, any amount required to be reported on
such form shall be entered at the nearest whole dollar
amount

--- end quoted text

Section 6102, in part says:

(a) Amounts Shown On Internal Revenue Forms

The **Secretary** is authorized to provide with respect to
any amount required to be shown on a form prescribed for any
internal revenue return, statement, or other document, that
if such amount of such item is other than a whole-dollar
amount, either--

(1) the fractional part of a dollar shall be disregarded; or
(2) the fractional part of a dollar shall be disregarded
unless it amounts to one-half dollar or more, in which case
the amount (determined without regard to the fractional part
of a dollar) shall be increased by $1.

--- end quoted text

Emphasis added.

Drew Edmundson, CPA (NC)

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- quote -

Well, are they rounding downwards or are they truncating?

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- quote -

Well thanks for that nugget. I didn't know that.

But tell me this, why does IRS round downwards on CPC 2000
notices?

Cheer$,
Harlan Lunsford

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Harlan Lunsford wrote:
- quote -

Actually, if 99 cents and below, do not report.

Authority: 26 USC 6102(a)(1) "The fractional part of a
dollar shall be disregarded."

(a)(2) allows for the rounding to the nearest dollar where
0.50+ adds 1 dollar.

This means that a taxpayer may TRUNCATE and need not round.

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Angie Griffin <angelwings3110[at]aol.com> wrote:

- quote -

Nope. All income is reportable unless excludable by law.

What you might have heard is if your total net self
employment income, the amount entered on Form 1040 Line 12,
is not more than $400 (the actual amount is 433) then you do
not calculate or pay self employment tax or file Schedule
SE.

__
Art Kamlet ArtKamlet [at] AOL.com Columbus OH K2PZH

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Angie Griffin wrote:

- quote -

Your requirement to file is based on your age, filing status
and gross income (GI). E.g., a single person under age 65
has to file if GI is at least $7800. In addition, for
individuals who are self-employed, the filing threshold is
much lower. A self-employed individual has to file if
self-employment net earnings is at least $400. There is also
another rule for individuals who are claimed as someone
else's dependent and another rule for someone who receives
church income.

--
Alan
http://taxtopics.net

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Angie Griffin wrote:

- quote -

I can see where this came from: If you make less than $433
net income otherwise subject to self-employment taxes, you
don't have to pay THOSE taxes. You still have to report the
income for income tax purposes.

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Angie Griffin wrote:

- quote -

Completely incorrect.

ALL income is taxable, or at least subject to tax for the
year. Even if an interest income statement is 50 cents, that
rounds up to a dollar and is reportable. However.... if 49
cents or below, do not report; instead, enjoy!

Cheer$,
Harlan Lunsford, EA n LA

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- quote -

Wrong!

All freely provided advice guarantee correct or double your
money back

Frank S. Duke, Jr. CPA
Cincinnati, OH USA

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angelwings3110[at]aol.com (Angie Griffin) writes:

- quote -

Oh, I don't doubt that you heard it, but it's wrong. Every
dollar must be reported.

Phil Marti
Topeka, KS

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I heard that if you make less than 400 dollars at one
particular job that you don't have to file that with your
taxes is this right or wrong???

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