A Big Difference Between Tax Avoidance and Fraud

In Tampa, the self-proclaimed “Queen of Tax Fraud” just got sentenced to 21 years in prison.  Part of her downfall was posting pictures on Facebook.  Really? Talk about playing with fire and getting burned!

There is a huge difference between tax avoidance and tax fraud.  The tax law is written in words and words are subject to interpretation. And there is nothing wrong with interpreting the law in your best interest.   The highly respected Judge Learned Hand (1872-1961) once wrote  “Any one may so arrange his affairs that his taxes shall be as low as possible; he is not bound to choose that pattern which will best pay the Treasury; there is not even a patriotic duty to increase one’s taxes.”  But total disregard of the law and stealing records and money, that’s a different story.  That is stealing from the Government which ultimately gets their money from us.  So she was stealing from us.  And bragging about it.

“The Queen’s” sentence was based on the calculation that she had stolen $3.1 million.  Not just a minor clerical error.  Investigators later determined Ms. Wilson stole between $7 million and $20 million.  Also, not just a minor clerical error.

You can be conservative or aggressive, at your option.  Either way, make sure that you can support all your deductions by keeping good tax records.  An IRS Appeals Officer once told me that, for small businesses, more deductions are lost because of lack of documentation than for incorrect interpretation of the tax law.   Don’t let this happen to you.  For a simple solution for complete tax records, visit http://www.MyTaxBuddy.com


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