Don’t Fudge the Numbers
When the tax season is at its peak, it could be extremely tempting for people who are filing tax returns or, at times, even experienced tax preparers to get a better refund by fudging the numbers a little. Although the IRS may overlook many slight misstatements, when the tax authority initiates an enforcement or investigative action, folks at IRS come with all they have.
If you have been accused of concealment of income or making false or misleading statements on your tax return, you can face dire criminal and civil consequences and must get in touch with an experienced taxpayer attorney as soon as practicable.
If you file a fraudulent tax return, it is considered misreporting and concealment of income by the IRS; concealment of income could result in both civil and criminal penalties under the law. That being said, civil penalties are usually more common; this is because the government needs to dedicate fewer resources to the investigation as it has to meet a relatively lower burden of proof.
Keep in mind that there are various levels and types of accuracy-related penalties if you understate or conceal your income. If you are negligent, in other words, you fail to make reasonable attempts to ensure compliance with the relevant tax laws by substantially understating your income; you will be subjected to a huge penalty of up to twenty percent of the amount of the tax underpaid.
On the other hand, civil fraud is a very serious issue. If there is compelling and clear evidence that you understated your income with the intent to defraud the authorities, and your intent was the evasion of tax assessment that you believed you owed, it can be a complex case of civil fraud. In these cases, the penalty for fraud can amount to up to 75% of your tax underpayment.
It is worth mentioning that felony criminal statutes are usually the most effective enforcement tools that are used by the IRS. If the agency initiates a criminal case against you, it is likely that they have very strong and persuasive evidence against you. Remember that a criminal conviction for evading tax could carry a long prison term of up to 5 years along with substantial charges and fines needed to cover the expenses of prosecution.
Build a Compelling Case with the Help of a Tax Attorney
Although both criminal and civil penalties for concealment of income can be stiff, you can fight the case with the help of a professional tax attorney. In case you are facing tax-related penalties or investigation by the agency for purported concealment and inaccuracies on the tax return, be proactive and consult a tax defense attorney.
So act right now and contact Ayar Law today and set up your free consultation (248) 262-3400.
Latest posts by Venar Ayar (see all)
- How Long Does a Typical IRS Tax Audit Take? - July 2, 2018
- SEP Agents and the Legal Marijuana Business: The Newest Threat to the Industry - July 2, 2018
- File Back Tax Returns Before Submitting an Offer in Compromise - June 25, 2018