IRS Uncertain Tax Position (UTP) Disclosures Are Now Mandatory

What is IRS Uncertain Tax Position

Each and every person is now required to declare and disclose UTPs as a part of the tax return. This announcement has been received with a pinch of salt by people who were benefitting by not including UTPs in their tax returns.

As per the current IRS tax laws an uncertain tax position has been clearly defined. It is any position in which a tax payer has a reserve applicable to that particular tax position and must be included in the filing of the tax return. As per the exact declaration of the IRS, a large number of people and organizations will be affected. This is a way to ensure that almost everyone ends up paying the correct tax and the chances of evasion are reduced drastically.

Uncertain Tax Position Disclosures

The disclosure of UTPs will have a significant impact on the way the auditors operate. Now the auditors will rely on the schedule submitted to discover UTPs and the impact will be the same as tax accrual work papers. The job of the auditors will be much easier as they will not have to go through large amounts of information and will get a schedule that will disclose all they want to know.

As a tax payer, it is bound to benefit you as well. Due to these new IRS tax laws you will have to submit lesser information to the auditors and the audit will be completed in lesser time thereby causing less in convenience. It can be safely commented that this law is good for people and organizations that do not try to evade tax and can be a problem for people and organization that try to pay less tax than is due to the IRS.

IRS tax laws are almost always being improved in such a way so as to make the collection of tax easier. You should remember that though the provisions seem to be strict it is actually beneficial in the long run. Not only is almost everyone forced to declare and pay the correct taxes but the people and organizations have a lesser chance of evading tax. As an honest tax payer, you should aid the IRS in this endeavour thereby allowing the growth the development of the country.

Do you really believe this is a good move? Please share your opinion here

About the Author

Sandra
I am working as Editor in Chief for Financeninvestments.com. Writing on Financial Topics is my passion. You can find me on , Seeking Alpha Instablogs or join our Facebook Community, s. FNI is a great Community for financial bloggers and writers. Get everything you wanted to know about your finance and investment related matters such as mutual funds, banking, retirement, economics and much more.

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