Posts Tagged ‘Taxation’

Civil and Criminal Tax Evasion

March 27, 2014

Jail and money

The difference between tax avoidance and tax evasion?  About 5-10 years in jail.

However, there is a big difference between civil and criminal tax evasion

Civil tax evasion adds penalties to the tax that you owe.

Criminal tax evasion means jail time plus penalties and restitution.

So the difference is money or time or both.  Not worth the risk.

The IRS has a job to do just like you and me. That job is to enforce the laws that Congress enacted.

So, be as aggressive as you are comfortable with.  Hire a tax professional.

But remember that pigs get fat and hogs get slaughtered.

Good News. Bad News.

August 31, 2013

When buying furniture and equipment, the Internal Revenue Code Section 179 allows a business an option to write off the total cost in the year purchased. This is true whether or not you have made all the payments for the purchase.  So if you bought it on Good News Bad Newscredit you can still get the deduction. That is the good news. And that is the bad news.

The good news is that the deduction reduces your current year taxable income and possibly your tax.

The bad news is that you may need the deductions more in a future year.  And the deduction may be limited depending on your income.  And the rules have some twists and turns.  And, if you sell it, all the proceeds are taxable.

Don’t presume that it is best to take the deduction this year. Ask your Tax Professional.  More good news,  you now have enough information to ask some intelligent questions.

And, of course, you must keep good records.

Hint – Make a folder for each of your large purchases that have a warranty.  Put a copy of the receipt, warranty and instruction book in the folder.  A few months ago, I received a new part for my office chair because I could easily put my hands on the warranty and receipt.


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