These Illegal Tax Moves Could Cost You Big
These Illegal Tax Moves Could Cost You Big
Everybody fibs on his or her taxes right? What’s a few dollars here and there? The IRS will never notice it. While it’ true that many taxpayers alter the real numbers on their tax returns and get away with it, honesty is always the best policy. Cutting a few dollars off your income, or claiming more credits than you deserve might not seem like a big deal, but if you get caught, the price could be stiff.
Honest Mistake or Willful Cheating?
There are two kinds of tax mistakes on a tax return: accidental and willful. If you make an honest mistake, then you typically won’t find yourself in any real big trouble. You do have to correct your mistake, and it could still cost you. Just because it was an honest mistake, that doesn’t mean the IRS will forgive you. If you owe more money than you paid, then you will need to pay that amount. Most likely, if you pay it off in a timely manner, then you won’t be faced with penalties and interest. However, that is not always the case.
If the IRS believes you willfully fudged on your tax return, then you will almost assuredly face penalties and interest. If your lies are really bad, then you could even face some jail time. So, if you want to avoid these kinds of penalties, then make sure you stick to the facts. Be completely honest on your tax return and you’ll never have to worry about being punished for the information on your return.
Avoid These Common Illegal Tax Moves
Here are some illegal tax moves that you should definitely avoid if you want to stay on the IRS’s good side:
Not reporting all your income – no matter the source, whether you’re employed, self-employed, or both, you need to report all types of income. That includes gambling earnings, capital gains, and much more. You should report ALL income you earned throughout the year. Failing to do this could land you in hot water with the IRS.
Ignoring current tax law – tax laws change every year. That’s especially true this year. Make sure you use the most current tax laws when filing. The IRS will have little or no sympathy if you make this mistake.
Claiming your pet as a dependent – people love their pets. Some animal owners treat their pets like they’re part of the family. But when it comes to taxes, you can’t count your pets as dependents. This is a rather easy one for the IRS to catch because your furry friends don’t have a valid Social Security number.
Deducting personal purchases as business expenses – many taxpayers use this trick when they file. It’s an easy way to write off personal items. However, if you can’t really prove that you have a business need for the item then the IRS will hold that against you. And you will pay the price.
Claiming tax credits for which you don’t qualify – we all like receiving tax credits. It’s free money from the government. However, if you don’t qualify for a certain credit, but you claim it anyways, the IRS will punish you if they catch it.
Remember, honesty is always the best policy. In order to avoid penalties and interest, as well as fines, or even jail time, just be completely honest when you file your tax return.
We hope you found this article about “These Illegal Tax Moves Could Cost You Big” helpful. If you have questions or need expert tax or family office advice that’s refreshingly objective (we never sell investments), please contact us or visit our Family office page or our website at www.GROCO.com. Unfortunately, we no longer give advice to other tax professionals gratis.
To receive our free newsletter, contact us here.
Subscribe to our YouTube Channel for more updates.
Alan Olsen, is the Host of the American Dreams Show and the Managing Partner of GROCO.com. GROCO is a premier family office and tax advisory firm located in the San Francisco Bay area serving clients all over the world.
Alan L. Olsen, CPA, Wikipedia Bio
GROCO.com is a proud sponsor of The American Dreams Show.
The American Dreams show was the brainchild of Alan Olsen, CPA, MBA. It was originally created to fill a specific need; often inexperienced entrepreneurs lacked basic information about raising capital and how to successfully start a business.
Alan sincerely wanted to respond to the many requests from aspiring entrepreneurs asking for the information and introductions they needed. But he had to find a way to help in which his venture capital clients and friends would not mind.
The American Dreams show became the solution, first as a radio show and now with YouTube videos as well. Always respectful of interview guest’s time, he’s able to give access to individuals information and inspiration previously inaccessible to the first-time entrepreneurs who need it most.
They can listen to venture capitalists and successful business people explain first-hand, how they got to where they are, how to start a company, how to overcome challenges, how they see the future evolving, opportunities, work-life balance and so much more..
American Dreams discusses many topics from some of the world’s most successful individuals about their secrets to life’s success. Topics from guest have included:
Creating purpose in life / Building a foundation for their life / Solving problems / Finding fulfillment through philanthropy and service / Becoming self-reliant / Enhancing effective leadership / Balancing family and work…
MyPaths.com (Also sponsored by GROCO) provides free access to content and world-class entrepreneurs, influencers and thought leaders’ personal success stories. To help you find your path in life to true, sustainable success & happiness. It’s mission statement:
In an increasingly complex and difficult world, we hope to help you find your personal path in life and build a strong foundation by learning how others found success and happiness. True and sustainable success and happiness are different for each one of us but possible, often despite significant challenges.
Our mission at MyPaths.com is to provide resources and firsthand accounts of how others found their paths in life, so you can do the same.
Empowering Leaders of Family Businesses
Transcript: Alan Olsen Welcome to American Dreams. My guest today is Lee Brower. Lee, welcome to today’s show. Lee Brower Alan, I’m delighted to be here. Thank you for having me. Alan Olsen Oh, I’m excited for this session night ugly. I’ve sat in classes with you. Management Consulting techniques, strategic planning. And…
Redefining Social Responsibility In The Financial Industry: Our Conversation With David Reiling
See David’s Recent Interview with Alan Olsen: https://www.youtube.com/watch?v=ztdtPfH9RAk&t=2s David Reiling is an accomplished social entrepreneur and innovator in the field of community development finance and financial inclusion. He has been the Chief Executive Officer of Sunrise Banks since 1995, and since then, he has successfully transformed Sunrise Banks into a leading player in the industry,…
NBA All-Star Weekend Economic Influence
Written by Ryan Hickman If you have walked around downtown Salt Lake City recently, you’d come across ginormous signs advertising the NBA. But not just advertisements for the local Utah Jazz, but for the annual pinnacle of NBA events: the 2023 All-Star Game. This annual event envelopes whichever city hosts the events, which include…