7 Ways You’re Accidentally Committing Tax Fraud

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Not every fraud artist is a sketchy identity thief or faux Nigerian prince from the dark corners of the internet. You might end up committing accidental tax fraud or accidental tax evasion if you don’t pay careful attention this tax season.

Individual slip-ups usually result from negligence rather than ill intent, but even white lies fall into the latter category. The IRS is serious about nipping fraud in the bud, which is why you should check and double-check your return before filing your taxes to avoid tax fraud penalties. Get the deductions and credits you’re entitled to, but make sure you do it legally. So that you don’t accidentally commit tax fraud, educate yourself on how do you commit tax fraud and check out these seven common mistakes to avoid when filing taxes.

What Is Tax Fraud?

Wondering how to commit tax fraud? The IRS defines tax fraud as “an intentional wrongdoing on the part of a taxpayer with the specific purpose of evading a tax known or believed to be owing.” To meet the IRS’s tax fraud definition, there must be both a tax due and owing, and fraudulent intent. Keep reading to find out about tax fraud examples that might surprise you.

1. Filing a Return With Missing or Incorrect Information

It’s crucial to file complete and accurate tax returns — or you might be committing tax fraud. For example, if you paid thousands of dollars to attend college this year, you might be eligible to claim an education tax credit to reduce your taxes.

If you claim an education credit, however, don’t forget to include Form 8863 — for education credits — with your return. Forgetting to include vital data like your Social Security number — or entering it incorrectly — also creates headaches.Plan for Your Future Sponsors of

How to avoid it: Professional tax preparers or tax preparation software can come in handy. Often, tax software with built-in e-filing won’t let you submit your forms unless all your necessary data is included.

Potential penalty: Typically, if you forget or make a mistake on your return information you’ll experience delayed processing of your tax return. Keep in mind that omissions prompt the IRS to take a closer look at your forms — and maybe even target you for tax fraud. If omitted data changes your status from owing money to getting a refund — or even just makes your refund higher — your mistake could be interpreted as willful failure to supply information, which comes with penalties of up to a year in prison, $100,000 in fines or both.

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