Definition: Providing false information to the IRS about business income or expenses
Deliberately underpaying taxes owed
Substantially understating your taxes (by stating a tax amount on your return which is less than the amount owed for the income you reported).
Tax evasion is the illegal act or practice of failing to pay taxes which are owed. In businesses, tax evasion can occur in connection with income taxes, employment taxes, sales and excise taxes, and other federal, state, and local taxes.
Examples of practices which are considered tax evasion:
Knowingly not reporting income
Under-reporting income (claiming less income than you actually received from a specific source
Because tax evasion is considered intentional, the IRS can bring you under criminal charges and tax evasion can result in jail time as well as substantial fines and penalties.
.Common Misspellings: Tax evasion is commonly confused with tax avoidance, which is the legal minimizing of taxes owed by approved means.
