Tax fraud is one of the most serious tax related crimes a person can be accused of. It is a broad term which is defined as the criminal attempt to intentionally evade tax laws or defraud the IRS. While tax fraud can be a hard charge for the government to prove, the legal repercussions of a conviction can include a maximum prison term of five years and a $100,000 fine. In addition, even a mere allegation of tax fraud could cause serious damages to a person or business’s reputation.
If you are under an IRS investigation for tax evasion, reach out to Frost Law’s tax fraud attorneys immediately. Whether you are accused of personal, business, or international tax fraud, our legal team can build your defense and fight for you.
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Types of Tax Fraud
According to a 2019 report by the Government Accountability Office, the U.S. federal government loses roughly $458 billion yearly to tax evasion. The IRS has found that some of the most common types of tax fraud include:
- Failing to pay due taxes or back taxes
- Filing false tax returns
- Intentionally failing to file income tax returns
- Keeping two sets of financial ledgers
- Using a fake SSN
- Intentionally underreporting or excluding income
- Overstating the amount of deductions
- Claiming false deductions or exemptions
Given the complex nature of the U.S. tax code, it is understandable that mistakes will be made during the tax filing process. By consulting Frost Law’s experienced legal team, taxpayers can understand why the charges were filed against them and how best to move forward and clear their name.
Tax evasion falls under the umbrella of tax fraud, and therefore has many similar traits. Tax evasion is defined as any intentionally and illegally underpaying taxes or hiding income from the IRS. Examples of tax evasion include:
- Intentionally underpaying taxes
- Underreporting income
- Falsifying records
- Claiming false dependents on tax returns
- Claiming false or inaccurate business expenses
It is important that we do not confuse tax fraud and tax evasion with tax avoidance. Unlike the previous two crimes, tax avoidance is not a criminal offense. It occurs when a person or business uses IRS approved methods to minimize their tax dues. Examples of tax avoidance include:
- Claiming tax deductions you legally qualify for
- Delaying taxes for a later date through tax deferred plans (IRAs, 410(k)s, etc.)
- Claiming tax credits for legitimate expenditures
While tax avoidance may sound like a miracle answer to lowering dues, it can be quite easy for those with the best of intentions to unintentionally break the law. If you wish to learn more about how tax avoidance works, reach out to Frost Law to discuss your options. Our tax consultants can help you decipher the tax code and get the law to work in your favor.
Consult a Local Tax Fraud Attorney Today
Whether you have been accused of tax fraud or wish to lower your tax expenses, Frost Law’s legal team is at your service. We will leverage our resources and collective experience to work diligently on your case. Put your worries to ease by calling (717) 251-5029 and obtaining the help of a skilled tax fraud attorney today.