Tip: IRS Aims to Boost Small Business Tax Compliance

The Internal Revenue Service believes the small business sector is a major source of under-reported income.For the past four years, the agency has run a special independent office charged with finding how to encourage small business owners to report their earnings more accurately. The IRS finds sole proprietors especially challenging. Many operate on a cash basis – at least in part – and report income on their personal tax returns, making it difficult for the taxman to correctly identify the sources of their cash flow.

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