When an enterprise intentionally underpays its due taxes, the act may be categorized as tax evasion. While the tax code is complex, tax procedures are relatively easier. Every citizen fills data forms based on income, family size, and expenses. From this information, IRS calculates deductions, which is the income after subtracting expenses. These deductions are used to conclude the adjusted gross income (AGI) of every family. The service calculates the tax you owe the state based on the previous information.
Tax fraud can be committed on any step of the taxation process. The most frequent form of tax evasion is when people report their income less than it actually is. Another form of tax evasion is the failure of submitting tax return altogether, so the IRS has no means of auditing the person’s income. Some families might even overstate their household size, which further reduces deductions.
In certain cases, the IRS launches a federal investigation when suspecting people of committing these activities. If a case is established, they may take legal action against you for tax fraud. The prosecution may try their best to prove that your mistakes were intentional.
If you are being convicted of tax evasion charges, hiring an experienced attorney may benefit you. The attorney might provide you with legal information and guide you on how to put together a case that yields the best possible outcome. Tax evasion is a serious crime and penalties against it are severe; therefore it is important to have a strong case at trial.