The IRS Audit Blog

Posts Tagged ‘tax evasion’

Question: tax evasion? possibly fraud?

ok back in 2006 i started a job with a tile company, they paid me under the table in personal checks and all were deposited into my personal checking account….now he never gave me any 10-99’s and told me that i didn’t have to claim any income from him. and if i was asked about it that i was to tell them i sold him household stuff from my house and that’s where the money came from…well it went on for 2 yrs and i had some trouble getting loans because they wanted to see a pay stub, well i switched jobs, now the old boss is being audited and called me and told me not to talk to the irs…am i possibly in trouble for not filing those taxes and if so, would it be to my benefit to tell them everything about the business he’s been running and avoiding taxes?
basically i want to make this right and get it over as quickly as possible, what are the reprocussions in doing this?

Answer: First off, don’t listen to Sassy – she’s full of horse dip. The IRS is not going to throw you in jail for not reporting all your income. They ain’t that stupid. They know you’re not going to be able to pay them ANYTHING if you’re sitting in a jail cell somewhere.

Having said that you are going to owe some taxes. Deal with it. I would strongly advise you to seek the services of a professional tax preparer. In your case I would seek out an Enrolled Agent. That is a tax professional that is “licensed” to represent you before the IRS. Have them prepare the tax returns for you and get them filed – don’t worry about paying the tax at this time.

The IRS takes FAILURE TO FILE a lot more seriously than inability to pay. Don’t put it off. File the returns NOW before the IRS approaches you OR they file a return for you (which will NOT be in your favor).

Many tax professionals belong to the National Association of Tax Professionals [NATP]. Click on the first link to go to their zip-code searchable website. Enter your zip and a radius you want to search within and it will return a listing of tax pro’s in your area. Call ‘em and find one that is an Enrolled Agent (or a CPA if an EA isn’t available – however they usually charge more than an EA).

When you find out how much you owe, then submit a Form 9465 – Installment Agreement Request [click on the second link to pull up a copy] to ask for a payment plan. THEN when the IRS asks you about your income, then you can offer your testimony and be “covered” since they asked you about your employer.

G’Luck…

Mike Womack, Sr. Partner
Zero Degrees Tax LLP
Moore, OK
Lawton, OK

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Question: Is this tax evasion or is it legal?

Is it tax evasion if a small business owner buys a luxury car (Mercedes, BMW, Porsche, etc.) for his kid and claims it as a business expense? Or what if the entire family claims that 100% of the miles they drive are business-related? Would this person ever be audited by the IRS?

Answer: Yes, it is tax fraud. You could call the IRS and report it, which would make it more likely they get audited.

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A proposed financial-transaction tax on stocks, futures, and other instruments may look like a quick and easy fix to the nation’s economic woes, but tax firm GreenTraderTax strongly disagrees, citing dangerous effects to the U.S. economy and marketplace. Its campaign to stop this tax is in full swing, and organizers are calling all traders, financial professionals, brokers, and other …

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Question: When does IRS investigate on individual tax?

If one has file 1040 income return tax form in the past 8 or 9 years, but the income is only around like 16k for the pass 3 to 5 years, and last year 26k. Now, this person wants to buy a condo and he’s going to get money as gift from friends and relatives on foreign country that adds up to approximately 150k, would he be in trouble? Is there anything wrong with it?

Answer: If the foreign gifts are more than $100,000, you must file IRS form 3520.

If you have a foreign bank account with more than $10,000, you must file form TDF 90-22.1

As for trouble, you just produce the same gift letters you gave the bank.

UBS Client Receives Five Years’ Probation

A UBS banking client who pleaded guilty to concealing $6.1 million in secret Swiss bank accounts has been sentenced to five years probation, even as the whistleblower who helped expose the UBS tax evasion scheme is set to begin a prison term Friday.

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