If you are looking to become self-employed and are good with numbers, you may want to consider a business tax recovery opportunity as one career possibility.
Business Tax Recovery Opportunity - An Overview
This type of business offers a specialized service to business owners where income tax returns filed in previous years are reviewed for errors which have resulted in an overpayment of taxes. Reviews are conducted by fully-trained tax review specialists.
If the review reveals that the business has overpaid its taxes, then a refund may be requested. Clients are asked to provide income tax records for the last three years and to fill out a questionnaire. A power of attorney allowing the tax recovery consultant to communicate with the IRS on the taxpayer's behalf also needs to be signed.
Time Limit to Make Claim
Taxpayers (whether individual or business owners) have only three years to request a refund from the Internal Revenue Service (IRS) for overpaid taxes. After the three-year period has passed, the taxpayer loses the right to obtain a refund; the IRS keeps the unclaimed funds. The IRS is under no legal obligation to inform taxpayers that they may have overpaid their taxes. Since taxes take up a large chunk of one's budget, it's imperative to determine that the required amount, and no more, is paid annually.
Potential Clients
With this type of business opportunity, all taxpayers are potential prospects. Some estimates indicate that more than 50% of tax returns contain an error that would result in a refund to the taxpayer. The average amount of these refunds is over $5,000.00. With these figures, it is well worth the taxpayer's while to have someone review tax forms filed over the previous three years.
Fees
No up-front fees are charged to the business owner in a business tax recovery opportunity. If the business is able to claim a refund, the business tax recovery consultant receives a percentage of the amount and the business owner receives the rest.
If the Claim is Denied
In the event that a claim for a refund is denied, the business owner has the option of appealing the decision to the Administrative Hearing Commission. The appeal process must be started within 60 days of either the date the decision was mailed or the date the decision was received. The earlier of the two dates is used to calculate the 60-day period.
Advantages of Business Tax Recovery Business
Potential clients for this type of business may not have the time or the expertise to keep up to date on changes made to state and federal tax regulations.
Changes to the tax laws may be applied retroactively in some cases. The business tax recovery consultant will be aware of these changes and whether they can be used in a particular situation.
Since the fees are paid from any moneys recovered, there are no out-of-pocket expenses for the taxpayer.
The tax recovery firm fills in all the appropriate forms and forwards them to the IRS for processing.
Starting a Tax Recovery Business
Companies offering accounting, tax preparation, and/or business valuation services may consider offering tax recovery assessments to their clients as well.
Another option for taking advantage of a business tax recovery opportunity is to contact one of the companies offering a turnkey operation to new business owners.
No one wants to pay more taxes than they have to. A business tax recovery opportunity is well worth considering, since entrepreneurs will always be interested in ensuring that they have not overpaid at tax time.
