Avoid the Temptation of Tax Evasion

  • November 20, 2019

If you intentionally fail to pay taxes or underreport your taxable income, you could be charged with tax evasion. 

In order to be convicted of tax evasion, the IRS must show that you deliberately tried to underpay your taxes. If you simply made an error, you’ll still have to pay what you should have paid, and possibly an additional fine. But at least you’ll avoid the time, expense, and penalties of a criminal trial. That in itself is worth its weight in gold, considering what you'll be avoiding!

Tax Reporting Mistakes are not Considered Tax Evasion

Tax forms are long, the Internal Revenue Code is complicated, and unless you’re an accountant or another tax professional, you're bound to make some mistakes that may result in underpaying your taxes. That said, even the most scrupulous number crunchers can – and do – make mistakes. Obviously you should always attempt to fill out your tax forms correctly, but there’s no need to worry about being convicted for tax evasion over a simple error. However, complex errors can make it necessary to hire a Tax Resolution Specialist to get the IRS to realize your mistakes were not intentional.

Tax Calculation is Simple at Its Core

Although the tax code is long and complicated, general tax procedures are fairly simple at their heart. Every year, Americans must file a return stating how much money they made, how big their families are, and what their expenses were. The IRS then calculates each family's total income and subtracts appropriate expenses, which we call “deductions.” Deductions are used to determine adjusted gross income or AGI. They then use a chart to determine what percentage of your AGI to tax and arrive at a number reflecting the taxes you should owe.

Finally, the IRS looks to see if there were any special circumstances that indicate you should pay fewer taxes, and then reduces the amount you owe by applying “credits.” Congress often offers these credits to motivate people to make changes in the way they live. For example, credits may be available to homeowners who make substantial improvements in order to make their homes energy-efficient. Another example is to offer credits to businesses that hire military veterans or people with criminal backgrounds.

A Few Examples of Tax Evasion

Each step of the taxation process is susceptible to tax fraud or evasion. If someone disregards the filing of their tax return, the IRS has no way of auditing their finances. One of the most common forms of tax evasion involves underreporting income. Typically, businesses and employees who deal largely in cash, such as wait staff, hairdressers, and retail store owners, sometimes underreport income because there’s not much of a paper trail. Conversely, some businesses inflate their expenses, and families may choose to overstate the size of the household in order to take larger deductions.

Additionally, some people may take advantage of the current tax credit system by misrepresenting their circumstances. If the IRS suspects you of any of these activities, it will launch an investigation and may prosecute you for tax fraud.

While it's best to avoid tax fraud of any kind, if you do find that you're facing tax evasion charges, you can be sure that the prosecution will be trying to show that your mistakes were deliberate. That's why you need a qualified Tax Attorney at your side – and that's why I'm here: to assist you in any tax evasion charges – or tax debt matters of any kind. My Tax Problem Solver Team and I will evaluate your situation and guide you to your best outcome. We can put your tax problem behind you so that you can sleep better at night and stop looking over your shoulder! Click here to set up a free 15-minute consultation. You can also email me at or call me at 855-232-5752.

About the Author Larry Heinkel J.D. LL.M

Larry Heinkel is a tax and bankruptcy attorney with more than 38 years experience helping businesses and individuals, solve their state and federal tax problems. Mr. Heinkel has been extremely successful in representing his clients before IRS and DOR, and is known throughout Florida as an expert in tax problem resolution.

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