Tax Evasion Avoidance

If you do not pay your taxes through illicit means it is called tax evasion. Avoidance, on the other hand, is reducing the amount of taxes you pay utilizing legal methods. The IRS reacts with severe penalties to tax evasion. Avoidance of tax payments is regarded as the right of every American taxpayer. Tax evasion requires deliberate and intentional methods to achieve its end. This includes but is not restricted to failure to report the collection of such taxes as sales tax. It may involve investments outside the country that are not noted for tax purposes or are reported falsely. The taxpayer involved may be running an employment tax scam for the purposes of tax evasion. Avoidance, however, while intentional, only attempts to minimize or eliminate a tax obligation through legitimate means. This may mean finding and employing a reasonable or different interpretation of specific tax legislation. There are no other specific legal terms for tax evasion. Avoidance is, however, referred to as both tax mitigation and tax minimization

Fast Facts

  • The voluntary compliance rate for paying taxes in 2008 was 83.7%

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  • Tax Evasion - Fraud Overview

    In the United States, tax evasion means illegally avoiding the assessment or payment of a tax. This should not...
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    • 4 of 7 user(s) found this useful
  • Offshore Tax Evasion

    Offshore tax evasion refers to the practice of hiding assets in offshore accounts for the purposes of avoiding...
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  • Tax Evasion

    Tax Evasion applies to individuals and businesses alike and involves the taxpayer intentionally overstating th...
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  • Tax Fraud and Crimes

      Tax Fraud occurs when individuals working and earning income knowingly and intentionally fail to file their ...
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    • 5 of 9 user(s) found this useful
  • Income Tax Fraud

    Tax Fraud occurs in situations where businesses or individuals knowingly and intentionally fail to file their ...
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