To understand tax evasion, Maryland residents should first know the tax process in more detail. When they file a return stating their yearly pay, the IRS will find their adjusted gross income by calculating deductions or expenses that cannot be taxed. Common deductions include business travel, educational expenses and charitable donations.
At this time of the year, the last thing on the minds of most people is their taxes. This makes perfect sense when you consider that Tax Day 2018 is still so far away and there are so many warm weather activities to enjoy.
In our post last week, we discussed how the principal duty of the Comptroller of Maryland's office is the collection of taxes and how it has a host of tools at its disposal to assist with the fulfillment of this duty. Indeed, the agency collects an astounding $16 billion per year armed with a budget of only $110 million.
Tax season is upon us, with the annual filing deadline steady approaching. For those with greater assets, the risks of over payment of taxes, as well as the risk of an audit, are ever-present concerns. You probably have someone who handles your finances and investments, as well as someone who specializes in taxes on your payroll.
Paying taxes is not a hobby to anyone. The greatest number of Americans pay taxes to avoid the grave consequences of federal tax crimes. Others devise strategies of eliminating or avoiding taxes within the legal framework. The Internal Revenue Service (IRS) of the US audits some of the returns submitted by businesses and individuals every year. If your returns reveal some irregularities, the IRS agents target you, and they launch investigations.
Perhaps you moved to Barbados for the surf and sun when you were 23 years old. Struggling to make ends meet, you set up a modest tourism company on the island. Over the last 30 years, it's grown into a multi-million-dollar business.
Maybe there's another world, another reality, where people can just not file their taxes to the Internal Revenue Service and everything works out just fine. But in our world, not filing your taxes is definitely a problem that will cause the non-filer to suffer many headaches.
The IRS added 23 new data elements to its tax return computer system filters this past tax season. The objective of these enhanced features was to locate instances of identity-theft related tax fraud. These efforts are being made to protect taxpayers from identity theft and prevent fraudulent tax returns from being filed.
Rowen Seibel, a well-known restaurateur, was sentenced to one month of jail time and 300 hours of community service for hiding more than $1 million from the IRS. He hid the funds by using a secret Swiss bank account and Panamanian shell company.
Special agents from the IRS Criminal Investigation Division want to talk to you. What do you do? In an effort to seem cooperative, you may agree to answer their questions. This is often a mistake. In fact, the wisest approach is the same as it would be for law enforcement - politely decline and say you need to talk to your attorney.