Employer Health Care Mandate Delayed

Lack of substantiation can undermine a taxpayer’s ability to use write-offs to which he or she is otherwise entitled. Take the case of Sean Richards, who claimed an education credit of $1,500. The amount of the credit didn’t match up with the Form 1098-T issued by the school. When the IRS questioned his return, he failed to provide any evidence of the tuition payments upon which the credit was based. Therefore, he lost the education credit that he may have been entitled to but couldn’t claim because he didn’t demonstrate his payments.

Lesson: Keep receipts and other documentation of all expenses for which a deduction or credit may be allowed.

Source: Sean Richards v. Commissioner; T.C. Memo. 2013-171