What can I do if I owe the IRS for not reporting sales of my mutal funds?
Full Question:
Answer:
I suggest contacting your broker or the mutual fund company for information on the gains on the sale. Generally, the taxable gain is the difference between the purchase price and the sales price. Currently net capital gain is generally taxed at rates no higher than 15%, although, for 2008 through 2010, some or all net capital gain may be taxed at 0%, if it would otherwise be taxed at lower rates. There are three exceptions:
-The taxable part of a gain from selling Section 1202 qualified small business stock is taxed at a maximum 28% rate.
-Net capital gain from selling collectibles (such as coins or art) is taxed at a maximum 28% rate.
-The part of any net capital gain from selling Section 1250 real property that is required to be recaptured in excess of straight-line depreciation is taxed at a maximum 25% rate.
Late payments are subject to penalities and interest, as well as the overdue tax amount, which may be as much as 47%. If you have a reasonable cause for the failure to pay the tax, the penalites may not apply. You may be able to settle for a lesser amount in an offer in compromise or arrange for installemnt paymments of overdue amounts.
