Like many people across Pennsylvania, you may find filing your taxes endlessly complicated, and you may, at times, make guesses or estimations during the process. In some cases, however, “fudging the numbers” or estimating when filing your taxes can land you in serious hot water, because in certain instances, your actions may prove criminal in nature.
Even if you do not have any malicious intent when you make errors filing your taxes, GoBankingRates reports that certain common tax mistakes cross the line and could potentially lead to tax fraud charges. So, what types of errors are Americans making that are drawing the unwanted attention of the Internal Revenue Service?
Failing to report all earned income is a major one, and you may be more likely to land in this type of trouble if you work in, say, hospitality, where you may earn a sizable portion of your income in tips. Failing to report all tips can have serious consequences, potentially costing you as much as $250,000 and five years behind bars.
Many people also commit tax fraud, whether intentionally or not, by claiming inaccurate or inflated deductions on their taxes. Certain guidelines govern what you can and cannot write off as business expenses, for example, and writing off expenses unrelated to you area of business can lead to problems. So, too, can inflating the amount of the deductions you write off. You may, too, may find yourself in trouble with the IRS if you try to take the earned income tax credit and you are not, in fact, eligible to do so.
This information about tax fraud is educational in nature and does not constitute legal advice.