X is for Xtreme Tax Problems- image of judge

X is for Xtreme Tax Problems

Strictly speaking, all tax problems are challenging.

However, some are far more serious than others.

Take tax fraud, for example.

There are various sorts of fraud, all come with penalties, and without an experienced tax specialist’s assistance, it’s easy for a minor matter to escalate into a significant tax problem if it is not handled correctly. As you know, filing a false tax return is treated seriously by the IRS. If an investigation turns up incriminating results, the cases can be referred for criminal tax investigation with possible arrests and tax-related criminal charges following.

The Internal Revenue Service takes tax evasion and fraud very seriously, imposing stringent fines and possible prison sentences for those who consciously avoid paying their tax liabilities.

According to the statute, tax fraud and tax evasion are very similar. However, tax evasion is a more severe and specific charge under the tax fraud umbrella. In other words, tax evasion is a more serious form of tax fraud. The burden of proof for tax evasion is higher, and so are the penalties.

Tax fraud effectively involves cheating on a tax return to avoid paying the entire tax debt. Tax fraud includes claiming false deductions, claiming personal expenses as business expenses, using a wrong Social Security number, and not reporting income.

Federal tax evasion is the most severe tax fraud charge. Under Internal Revenue Code § 7201, an individual may face federal tax evasion charges if they willfully try to evade or defeat the federal income tax. Tax evasion is a felony. It is the most serious of crimes. Typically, the maximum prison sentence is five years; the maximum fine is $100,000.

Jeffrey Schneider, EA, CTRS, ACT-E, has over 40 years of experience assisting taxpayers that find themselves with tax complications. If you owe more than 10K, contact us today to set up a free strategy session, during which time we can assess your tax situation and determine how we can help you eliminate your tax nightmare.

Contact us today by calling 877-355-8010 or book an appointment online.