Norman D. McKellar
THE McKELLAR LAW FIRM, PLLC
603 Main Street, Suite 405
Knoxville, TN 37902
1-877-4-TAX-SOS
877-482-9767
The McKellar Law Firm, PLLC
603 Main Street Suite 405
Knoxville TN 37902
In basic terms, tax fraud is the willful attempt to defeat or circumvent the tax law in order to reduce one's tax liability. Income tax fraud is also sometimes referred to as tax evasion and they literally can be linked to one another.
Tax fraud is a much more serious and punishable offense than tax evasion. While both have serious consequences, Tax fraud is usually a felony having serious consequences, including prison, criminal penalties and civil penalties. In addition to serious legal consequences, Income tax fraud may also carry a lasting social stigma.
Tax evasion is the general term for efforts by individuals, firms, trusts, and other entities to evade the payment of tax liabilities by breaking the law . Tax evasion usually entails taxpayers deliberately misrepresenting or concealing the true state of their affairs to the tax authorities to reduce their tax liability, and includes, in particular, dishonest tax reporting (such as under-declaring income, profits or gains; or overstating deductions).
Tax minimization, on the other hand is not income tax fraud. Every legal taxpayer has the right to reduce the amount of their taxes owed.
In some states, because of overwhelming pressure from the public, many prosecutors will stop at nothing to gain a conviction in tax fraud cases. And the potential punishment for a conviction can be quite severe.