How You’re Unknowingly Committing Tax Fraud
Tax fraud is something no one wants to get caught up with. Should you be suspected of tax fraud, the government would be cracking down hard on you and no one wants to get themselves involved in a charge of evading tax. Among the consequences of evading tax include a hefty fine, quite some jail time or even both.
But, the thing is that you may actually be committing tax evasion without even realizing it, also is better to avoid this investment fraud , especially in your rush to catch up with the yearly tax submissions deadline. Here’s how stuff like this can happen.
5 Reasons of Charging Tax Fraud
#1 Not Completely Reporting Your Income
Okay, so when tax season arrives, everyone would be frantically running about to complete their tax submissions. But, in our rush to complete it before the deadline, we may accidentally forget to include any additional income that you may have. Maybe it’s that bit of freelancing you did for a while, or that quick buck you made for a month when you rented out a spare room. You’ll need to report all of them, unfortunately.
#2 Stretching Business Expenses
Sometimes, you may be spending lesser in certain months in your business, and you may have kept the tax submissions for your monthly business expenses uniform. So this way, you might just get a bit more out of your tax payments. Sadly, this is also a form of tax evasion and you might want to start re-checking your business tax submissions.
#3 Blowing Up Your Claims
When paying for tax, there are some provisions where you’d be entitled for a claim or return especially for medical spending, education and a few other subsidized things. What some like to do is that they would jack up their provisional expenses, in order to get more returns at the end of the day. As much as this gives you a few more dollars for your savings, it isn’t shy away from evading tax.
#4 Overvaluing Charitable Payments
As nice people, we may tend to give a chunk of our earnings to charity yearly. If you’re a big business, your CSR wing is probably spending about 5-10% of your profits for your company’s charity events. But, when you put a bigger price tag on such payments, you’re also guilty of tax fraud. When documenting payments to charity, be sure you can be as accurate as possible, so that you don’t have to face the wrath of the law, later on.
#5 Totally Failing To Submit Your Tax Files
‘This is basically putting yourself in the red zone with an alarm stuck to your head. You may be tempted to run away from paying tax because “it’s my money, anyways”. As logical as that sounds, no one is quite exempt from taxes so be sure that the tax submission deadline does not pass you by and make sure that all your documents and numbers are in order so that you don’t run into bigger problems down the road.
Evading Tax Fraud
Tax evasion is a big deal and don’t you think that just because you don’t submit the documents that the IRS can’t trace how much you’ll need to be paying. They have lots of ways to track down your total income and when they find out the truth, they may just slap you with a fine that’s 3 or 4 times bigger than your initial tax payment. So, don’t get yourself into that trouble.
Disclaimer:
The above is intended for informational purposes only and does not constitute a legal advice or specific recommendations in any way.
