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Tax Fraud

Fraudulent original returns, non-fraudulent amended returns, and the Civil Statute of Limitations 

Introduction

Paying taxes is one of the essential responsibilities of every American. We all must pay taxes if we want to live in a civilized society. Every year, those who have tax obligations need to file their income returns and submit them at the IRS by April 15th (or by October 15th, if we need extra time). 

A tax return is well-documented proof that includes every kind of income a person or an organization has in the current financial year. The taxes one needs to pay are related to several aspects, tax exemption pointers, and several other forms associated with paying the taxes. 

Filing the tax returns doesn’t sound attractive to many people. It even sounds scary to some. 

Well, it could have been easy, provided the US government didn’t include legal punishments and penalties against the submission or filing of an erroneous tax return. 

On many occasions, it has been observed that the taxpayers have made mistakes in filing their returns one way or the other. Due to those errors, they will be punished, or their tax return will get rejected by the IRS.

Getting frazzled now, are we?

If yes, then it’s time to learn more about fraudulent tax returns, amendments, submission of corrected returns, and several other facts.  

What are fraudulent tax returns?

Tax frauds are widespread, both for individual and organizational taxpayers. When a taxpayer intentionally introduces errors and incorrect data in their tax returns, it’s a case of submitting a fraudulent tax. Here, in the original tax return, adjustments in the form of credits and deductions are made to reduce the total due amount of the tax liability the taxpayer needs to pay by the end of the financial year. Some argue that paying taxes is voluntary here in the US. Oh, please… don’t get me started on this topic of voluntary US taxes.

How to identify a fraudulent tax return? 

Now you might think that how the IRS department detects frauds in the tax return when the details of income and expenditure are confidential, right? 

If yes, then there is a huge surprise waiting in queue for you! 

Here, we have described a few ways in which your fraudulent original tax return can be detected easily. 

  • Misrepresentation of the incomes and expenditures to claim falsified tax deductions and credits.
  • Not paying the tax debt even after receiving multiple notices
  • Preparing a knowingly incorrect tax and submitting the file
  • Not including all the incomes and the sources, especially the foreign ones
  • Not filing nor paying payroll taxes 
  • Intentionally hiding foreign assets 

Can a fraudulent tax return be corrected?

Yes, you can correct the fraudulent tax returns, especially after the IRS rejects the submission and does not penalize you. However, during the correction of a rejected tax return, one must be very cautious to ensure that all the details are present and in proper amounts.

How to amend a rejected tax return to make it non-fraudulent?

Filing a corrected tax return to correct the falsified tax return is easy. Your original tax return won’t even be posted to the IRS to put you on notice if there was fraud in it. Now, you need to correct the amounts, the sources, the assets, etc. easy.  

Filing an amended return.

Filing an amended return is not that hard as well. Also, the IRS is totally Okay with you filing an amended return. We all humans and make mistakes. Correcting your unintentional errors is what shows that no fraud was intended.

Conclusion 

Every taxpayer needs to understand what is being submitted to the IRS. Tax preparers must make sure that they explain it to you in a way that you understand. Be diligent, and don’t hesitate to ask to clarify if something doesn’t look right to you. After all, you are the one responsible for what you are submitting to the IRS. Be it the domestic incomes or purchase of several foreign assets, these details need to be adequately discussed. Also, have the documents ready to back up the portion you mentioned, the tax exemptions and deductions, if the IRS wants to verify it.
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